The Head Of ‘The Central Bank Of The World’ Warns That Another Great Financial Crisis May Be Coming

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Jaime Caruana

Most peo­ple have nev­er heard of Jaime Caru­a­na even though he is the head of an immense­ly pow­er­ful orga­ni­za­tion. He has been serv­ing as the Gen­er­al Man­ag­er of the Bank for Inter­na­tion­al Set­tle­ments since 2009, and he will con­tin­ue in that role until 2017. The Bank for Inter­na­tion­al Set­tle­ments is a rather bor­ing name, and very few peo­ple real­ize that it is at the very core of our cen­tral­ly-planned glob­al finan­cial sys­tem. So when Jaime Caru­a­na speaks, peo­ple should lis­ten. And the fact that he recent­ly warned that the glob­al finan­cial sys­tem is cur­rent­ly “more frag­ile” in many ways than it was just pri­or to the col­lapse of Lehman Broth­ers should set off all sorts of alarm bells. Speak­ing of the finan­cial mar­kets, Caru­a­na omi­nous­ly declared that “it is hard to avoid the sense of a puz­zling dis­con­nect between the mar­kets’ buoy­an­cy and under­ly­ing eco­nom­ic devel­op­ments glob­al­ly” and he not­ed that “mar­kets can stay irra­tional longer than you can stay sol­vent”. In oth­er words, he is say­ing what I have been say­ing for so long. The behav­ior of the finan­cial mar­kets has become com­plete­ly divorced from eco­nom­ic real­i­ty, and at some point there is going to be a mas­sive cor­rec­tion.
So why would the head of ‘the cen­tral bank of the world’ choose this moment to issue such a chill­ing warn­ing?
Does he know some­thing that the rest of us do not?
Accord­ing to a recent arti­cle in the Tele­graph by Ambrose Evans-Pritchard, Caru­a­na is extreme­ly con­cerned about ris­ing debt lev­els and the cur­rent lev­el of eupho­ria in the finan­cial mar­kets…
The world econ­o­my is just as vul­ner­a­ble to a finan­cial cri­sis as it was in 2007, with the added dan­ger that debt ratios are now far high­er and emerg­ing mar­kets have been drawn into the fire as well, the Bank for Inter­na­tion­al Set­tle­ments has warned.
Jaime Caru­a­na, head of the Swiss-based finan­cial watch­dog, said investors were ignor­ing the risk of mon­e­tary tight­en­ing in their vora­cious hunt for yield.
“Mar­kets seem to be con­sid­er­ing only a very nar­row spec­trum of poten­tial out­comes. They have become con­vinced that mon­e­tary con­di­tions will remain easy for a very long time, and may be tak­ing more assur­ance than cen­tral banks wish to give,” he told The Tele­graph.
Mr Caru­a­na said the inter­na­tion­al sys­tem is in many ways more frag­ile than it was in the build-up to the Lehman cri­sis. Debt ratios in the devel­oped economies have risen by 20 per­cent­age points to 275pc of GDP since then.
And you know what?
Caru­a­na is cer­tain­ly cor­rect to be warn­ing us about these things.
As I have writ­ten about pre­vi­ous­ly, the total amount of gov­ern­ment debt in the world has grown by about 40 per­cent since the last reces­sion, and the “too big to fail banks” have col­lec­tive­ly got­ten 37 per­cent larg­er since that time.
The U.S. nation­al debt has grown from about 10 tril­lion dol­lars to more than 17.5 tril­lion dol­lars, and even the Bank for Inter­na­tion­al Set­tle­ments admits that the glob­al deriv­a­tives bub­ble has grown to at least 710 tril­lion dol­lars.
The mas­sive finan­cial imbal­ances that we were fac­ing dur­ing the last cri­sis have not been fixed. Instead, they have got­ten much, much worse.
But should we trust the Bank for Inter­na­tion­al Set­tle­ments?
Of course not.
This is a very secre­tive orga­ni­za­tion that very few peo­ple know about but that pos­sess­es absolute­ly enor­mous pow­er. The fol­low­ing is a brief overview of the Bank for Inter­na­tion­al Set­tle­ments from one of my pre­vi­ous arti­cles enti­tled “Who Con­trols The Mon­ey? An Unelect­ed, Unac­count­able Cen­tral Bank Of The World Secret­ly Does”…
An immense­ly pow­er­ful inter­na­tion­al orga­ni­za­tion that most peo­ple have nev­er even heard of secret­ly con­trols the mon­ey sup­ply of the entire globe. It is called the Bank for Inter­na­tion­al Set­tle­ments, and it is the cen­tral bank of cen­tral banks. It is locat­ed in Basel, Switzer­land, but it also has branch­es in Hong Kong and Mex­i­co City. It is essen­tial­ly an unelect­ed, unac­count­able cen­tral bank of the world that has com­plete immu­ni­ty from tax­a­tion and from nation­al laws. Even Wikipedia admits that “it is not account­able to any sin­gle nation­al gov­ern­ment.” The Bank for Inter­na­tion­al Set­tle­ments was used to laun­der mon­ey for the Nazis dur­ing World War II, but these days the main pur­pose of the BIS is to guide and direct the cen­tral­ly-planned glob­al finan­cial sys­tem. Today, 58 glob­al cen­tral banks belong to the BIS, and it has far more pow­er over how the U.S. econ­o­my (or any oth­er econ­o­my for that mat­ter) will per­form over the course of the next year than any politi­cian does. Every two months, the cen­tral bankers of the world gath­er in Basel for anoth­er “Glob­al Econ­o­my Meet­ing”. Dur­ing those meet­ings, deci­sions are made which affect every man, woman and child on the plan­et, and yet none of us have any say in what goes on. The Bank for Inter­na­tion­al Set­tle­ments is an orga­ni­za­tion that was found­ed by the glob­al elite and it oper­ates for the ben­e­fit of the glob­al elite, and it is intend­ed to be one of the key cor­ner­stones of the emerg­ing one world eco­nom­ic sys­tem.
The role that the Bank for Inter­na­tion­al Set­tle­ments is play­ing today was envi­sioned by the glob­al elite long ago. In anoth­er pre­vi­ous arti­cle, I quot­ed from a book that George­town Uni­ver­si­ty his­to­ry pro­fes­sor Car­roll Quigley wrote in 1975 enti­tled “Tragedy & Hope” in which he dis­cussed how the BIS was to one day become “the apex” of the glob­al finan­cial sys­tem…

[T]he pow­ers of finan­cial cap­i­tal­ism had anoth­er far-reach­ing aim, noth­ing less than to cre­ate a world sys­tem of finan­cial con­trol in pri­vate hands able to dom­i­nate the polit­i­cal sys­tem of each coun­try and the econ­o­my of the world as a whole. This sys­tem was to be con­trolled in a feu­dal­ist fash­ion by the cen­tral banks of the world act­ing in con­cert, by secret agree­ments arrived at in fre­quent pri­vate meet­ings and con­fer­ences. The apex of the sys­tem was to be the Bank for Inter­na­tion­al Set­tle­ments in Basle, Switzer­land, a pri­vate bank owned and con­trolled by the world’s cen­tral banks which were them­selves pri­vate cor­po­ra­tions.
And it is inter­est­ing to note that Pro­fes­sor Quigley was not against the sys­tem that the elite were set­ting up. He was just an aca­d­e­m­ic that was try­ing to accu­rate­ly con­vey what he had learned about how the glob­al sys­tem works.
Sad­ly, the sys­tem that Quigley wrote about all the way back in 1975 has ful­ly blos­somed today.
Every two months, the cen­tral bankers of the world trav­el to Switzer­land for “Glob­al Econ­o­my Meet­ings” in Basel. Most peo­ple have nev­er heard of them, but these Glob­al Econ­o­my Meet­ings were actu­al­ly dis­cussed in the Wall Street Jour­nal…
Every two months, more than a dozen bankers meet here on Sun­day evenings to talk and dine on the 18th floor of a cylin­dri­cal build­ing look­ing out on the Rhine.
The din­ner dis­cus­sions on mon­ey and eco­nom­ics are more than aca­d­e­m­ic. At the table are the chiefs of the world’s biggest cen­tral banks, rep­re­sent­ing coun­tries that annu­al­ly pro­duce more than $51 tril­lion of gross domes­tic prod­uct, three-quar­ters of the world’s eco­nom­ic out­put.
So how do you feel about the fact that the cen­tral bankers of the world reg­u­lar­ly gath­er to plot their next moves for the glob­al econ­o­my?
Should an unelect­ed group of cen­tral bankers that has no account­abil­i­ty to any nation­al gov­ern­ment real­ly have so much pow­er?