USA, UE: Enormous Lies About The State Of The Economy

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By Greg Hunter, USAwatchdog

The top story is the global economy.  It’s not fixed and there is no real recovery. Yes, I know the stock market hit all-time highs again, but that’s because the market believes the Fed; and now the European Central Bank will continue the easy money policies.  The ECB just announced it will go to negative interest rates of -.1% on deposits. That’s right.  In, Europe you have to pay a bank to hold your money!  If Europe was really in a so-called “recovery” as we have been told constantly for several years, would it need to go negative on interest rates?  Of course, it wouldn’t.  ZeroHedge.com called the move for negative interest rates “Officially Entering the Monetary Twilight Zone.”  It is no less than confirmation that nothing the ECB has done to date has fixed anything, and, in fact, the economy has gotten worse.  Please keep in mind, the Eurozone is in trouble despite the tens of trillions of dollars the Fed pumped into it through its swap lines.   

Back here in the U.S., we are continually told there is a recovery.  Check out this headline in the USA Today newspaper:  “Fed: Economy expands across USA.”  Listen to this quote from the article that says, “While manufacturing picked up smartly across much of the country, consumer spending and housing were mixed as remnants of the adverse weather conditions continue to have some effects in the Northeast.”  What planet are they living on?  It’s June and they are still blaming the weather for the economic slowdown?  Retail and housing numbers have rolled over–they are not “mixed.”  They have tanked.  10 million homeowners still have negative equity in their homes.  Despite a near 4% 30-year mortgage rate, home prices, according to one new report, are still falling.  With this low rate, home sales should be taking off like a rocket—they are not.  Maybe this is why 70 % of Americans think the housing crisis is not over, or the worst is yet to come, according to a new survey.  Also, what we now know is the first quarter of 2014 had a -1% contraction, and that was a stunning drop from the 2.6% growth the government “officially” reported in 4th quarter of 2013.

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Geopolitical stakes in Nigeria: Curious role of the IMF

Kaduna refinery (photo from nigerianbestforum.com)

As Nigeria spirals into instability, historian and economic researcher Frederick William Engdahl argues a recent government decision to lift subsidies on imported fuel in the oil-rich nation bears the mark of Washington Consensus shock therapy.

In the article below, Engdahl explains his view.

Nigeria, Africa’s most populous nation and its largest oil producer, is from all evidence being systematically thrown into chaos and a state of civil war. The recent surprise decision by the government of Goodluck Jonathan to abruptly lift subsidies on imported gasoline and other fuel has a far more sinister background than mere corruption, and the Washington-based International Monetary Fund (IMF) is playing a key role. China appears to be the likely loser along with Nigeria’s population.

The recent strikes protesting the government’s abrupt elimination of gasoline and other fuel subsidies, that brought Nigeria briefly to a standstill, came as a surprise to most in the country. Months earlier, President Jonathan had promised the major trade union organizations that he would conduct a gradual four-stage lifting of the subsidy to ease the economic burden. Instead, without warning he announced an immediate full removal of subsidies effective January 1, 2012. It was “shock therapy” to put it mildly.

Nigeria today is one of the world’s most important producers of light, sweet crude oil—the same high-quality crude oil that Libya and the British North Sea produce. The country is showing every indication of spiraling downward into deep disorder. Nigeria is the fifth largest supplier of oil to the United States and twelfth largest oil producer in the world on a par with Kuwait and just behind Venezuela with production exceeding two million barrels a day.

The curious timing of IMF subsidy demand

Despite its oil riches, Nigeria remains one of Africa’s poorest countries. The known oilfields are concentrated around the vast Niger Delta roughly between Port Harcourt and extending in the direction of Lagos, with large new finds being developed all along the oil-rich Gulf of Guinea.Nigeria’s oil is exploited and largely exported by the Anglo-American giants—Shell, Mobil, Chevron, Texaco. Italy’s Agip also has a presence and most recently, to no one’s surprise, the Chinese state oil companies began seeking major exploration and oil infrastructure agreements with the Abuja government.

Ironically, despite the fact that Nigeria has abundant oil to earn dollar export revenue to build its domestic infrastructure, government policy has deliberately let its domestic oil refining capacity fall into ruin. The consequence has been that most of the gasoline and other refined petroleum products used to drive transportation and industry, has to be imported, despite the country’s abundant oil. In order to shield the population from the high import costs of gasoline and other refined fuels, the central government has subsidized prices. Continue reading