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Financial Advisor Discusses the IMF and the U.S. Dollar

Blog discusses current happenings in the U.S. and world economies.

 
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Grand Rapids, MI -- (SBWIRE) -- 03/08/2013 -- Financial advisor Dennis Tubbergen writes a weekly newsletter to help his clients and readers in this endeavor and also pens a blog to take a closer look at topics such as the U.S. Dollar. It can be difficult to stay on top of everything happening in the world of finance today.

"Perhaps the most underrated story of the year is the fact that the International Monetary Fund, or IMF as the organization is most commonly known, is planning to double its size and attempt to move toward becoming the world's central bank," begins Tubbergen in his February 28, 2013 blog. "As I've previously discussed, the SDR or Special Drawing Right is the 'currency' of the IMF which is being readied to eventually become a reserve currency, nudging the U.S. Dollar from that position."

Tubbergen quotes from a February 20, 2013 article in The New American.

While headline stories about averting the dangers of an international 'currency war' dominated news coverage of the recently concluded G20 meeting in Moscow, the real unreported story is that the global gathering of central bankers and finance ministers is pushing forward with their plan for 'supersizing' the International Monetary Fund. The end goal is to transform the IMF into a global Federal Reserve, with the ability to flood the world with huge new volumes of loans and currency. It would also wield vast financial regulatory powers.

The IMF's unit of account, or 'currency,' known as a Special Drawing Right (SDR), is being readied for eventual adoption as the replacement for the U.S. Dollar in international transactions, to lead the way toward eventual adoption of the SDR or some other designated unit as the global currency, much in the same way that the euro was foisted upon the people of Europe as a replacement of their national currencies.

The mainstream media seem intent on keeping the public fixated on the latest Kardashian frolics, sportsmania, and Democrat-Republican political mudwrestling, while coverage of the G7, G20, and IMF confabs that are determining the economic fate of the world receive short shrift. And the little reporting of these events that does leak out usually amounts to little more than regurgitation of the pre-scripted talking points of the conference principals. Over the past four years, The New American has published numerous articles detailing the radical plans currently underway for the total destruction of the dollar and the plans for supersizing the IMF into a global Fed.

Virtually unreported was IMF Managing Director Christine Lagarde's comments at the close of the G20 Moscow summit on February 16 that she expected the IMF members to come through soon with the remaining funds necessary to double the IMF's funds. Unknown to most voters and taxpayers the world over is the fact that their governments' finance ministers agreed at the G20's Korea meeting in 2010 to increase the 'quotas' (contributions) of each member to the IMF, effectively doubling the IMF's SDR assets to about $U.S. 750 billion.

The IMF has also benefited immensely from another set of recent innovations that have received almost zero news coverage: the New Arrangements to Borrow (NAB) and the General Arrangements to Borrow (GAB).

Once activated, the IMF reports, the NAB 'can provide supplementary resources of up to SDR 370.0 billion (about $567 billion) to the IMF.'

"The potential amount of credit available to the IMF under the GAB totals SDR 17 billion (about $26 billion)," says the same IMF web page.

With our national budget now being measured in trillions of dollars, the mere hundreds of dollars the IMF is bandying about may no longer seem as impressive as it once might have. However, the IMF has much grander visions; this is just the start. As we reported previously, the IMF's Christine Lagrande in February 2011 called for a trillion dollar 'firewall,' including a European Stability Mechanism (ESM) for bailing out the collapsing economies of Europe's socialist regimes.

Finance ministers, including then U.S. Treasury Secretary Timothy Geithner, all took to chatting up the supposed necessity of the emergency 'firewall.' As we reported at the time, acceding to these calls would be the equivalent of 'giving even more matches and gasoline to the arsonists who have already burned through trillions of dollars in 'quantitative easing' and 'stimulus' funds.'"

"This scheme being designed by the world monetary leaders has zero chance of succeeding in my view," explains Tubbergen. "I reach this conclusion for two reasons."

Tubbergen notes that firstly, creating another fiat currency to bail out failing fiat currencies is an asinine idea. Unelss a new currency was backed by something tangible, it has zero chance of surviving long term. History proves that to be the case. It doesn’t matter whether you look at the Roman Empire, Weimar Germany, John Law's France or early colonial America, you reach the same conclusion in each case. Fiat currencies always fail.

Secondly, says Tubbergen, even if the $1 trillion firewall number is reached, it will be far, far less than would be needed to bail the world out of its debt problems. It wouldn't even cover the operating deficit of the U.S. last year.

"In order to solve the debt problems a gigantic re-pricing will be needed," concludes Tubbergen. "That will mean deflation and bank failures. The bankers that determine monetary policy know that and will continue to try to squeeze every last bit of profit from the system before the eventual re-pricing occurs."

To read the blog in its entirety go to www.dennistubbergen.com and select his February 28, 2013 entry. His radio show interviews with weekly guest experts are available as podcasts at www.everythingfinancialradio.com

Tubbergen’s syndicated radio show can be heard on metro Michigan stations WTKG 1230 AM and WOOD Newsradio1300 AM and 106.9 FM.

About Dennis Tubbergen
Dennis Tubbergen has been in the financial industry for over 25 years and has his corporate offices in Grand Rapids, Michigan. Tubbergen is CEO of PLP Advisors, LLC and has an online blog that can be read at www.dennistubbergen.comTo view Tubbergen’s latest Moving Markets? newsletter, go to www.moving-markets.com.

The opinions expressed herein are those of the writer and not necessarily those of USA Wealth Management, LLC. This update may contain forward-looking statements, including, but not limited to, statements as to future events that involve various risks and uncertainties. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual events or results to differ materially from those that were forecasted. Therefore, no forecast should be construed as a guarantee. Prior to making any investment decision, individuals should consult a professional to determine the risks, costs, benefits and fees associated with a particular investment. Information obtained from third party resources is believed to be reliable but the accuracy cannot be guaranteed.