During two chaotic minutes of Asian trading, the pound plunged the most since the Brexit referendum in June, with traders saying computer-initiated sell orders exacerbated the slump.
The 6.1 percent drop drove sterling to a 31-year low of $1.1841, according to composite prices compiled by Bloomberg of contributions from dealers. Traders speculated the crash might have been sparked by human error, or a so-called “fat finger,” with algorithms adding to selling pressure at a time of day when liquidity is relatively low.
While the currency snapped back in Asia, it resumed its freefall during European hours, as concern welled up that Britain is headed for a so-called hard Brexit that would restrict its access to the European Union’s single market in return for gaining control of immigration.
Preparing to rebuild the international economic system while World War II was still raging, 730 delegates from all 44 Allied nations gathered at the Mount Washington Hotel in Bretton Woods, New Hampshire, United States, for the United Nations Monetary and Financial Conference, also known as the Bretton Woods Conference. The delegates deliberated during 1–22 July 1944, and signed the Bretton Woods agreement on its final day. Setting up a system of rules, institutions, and procedures to regulate the international monetary system, these accords established the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD), which today is part of the World Bank Group. The United States, which controlled two thirds of the world’s gold, insisted that the Bretton Woods system rest on both gold and the US dollar. Soviet representatives attended the conference but later declined to ratify the final agreements, charging that the institutions they had created were “branches of Wall Street.” These organizations became operational in 1945 after a sufficient number of countries had ratified the agreement. On 15 August 1971, the United States unilaterally terminated convertibility of the US dollar to gold, effectively bringing the Bretton Woods system to an end and rendering the dollar a fiat currency. This action, referred to as the Nixon shock, created the situation in which the US dollar became a reserve currency used by many states. At the same time, many fixed currencies (such as the pound sterling, for example) also became free-floating.
Fast forward, it’s 10-8-2016, and leading FX strategists are telling us that markets are waiting for a “New World Order” – wasn’t that what was agreed at Bretton Woods? Was Nixon in on this plot, was he tricked, was it a coincidence that Kissinger was with Nixon at Camp David (and who knows, who else) the weekend before they created their ‘plan’ to default on Bretton Woods? No one knows, but we can certainly analyze current data.
This is New York Times Bestseller with well over 1 Million copies sold. It’s a well documented, research gold mine. After reading this book, you can say that you understand more about world politics than Political Science professors. This is the reality of the way the world really works, which is NOT taught in school. Through the book, you’ll see how the founder of IBM (Watson) not only enabled the Nazi regime to expand economically and manage the holocaust, he was Hitler’s personal friend (if you can say, Hitler had a friend), receiving the 2nd most prestigious medal of honor offered by the Nazi’s in that time. And also note that Watson was an American, a citizen of the country that would eventually go to war with Hitler. Like bankers who profit from both sides, IBM was literally making computing machines for both sides. The starving Nazi regime, in some part, was supported by their theft of Jewish assets domestically. IBM, reaped huge profits from their dealings with Hitler. Many of those profits were shared with employees in the USA, Watson even gave employees raises and one time bonuses. Here is a clear example of an unknown element of economic support of the US Dollar that’s hard to track economically, because IBM hid the profits in order to avoid paying taxes and more importantly, to avoid being accused of trading with the enemy (even before the war, it was unpopular to be in favor of the German regime). This argument about the hidden economic support of America’s economy, will be more obvious in later periods, such as during the 90’s, when America experienced a huge economic boom which politicians like to take credit for (There were global macro economic factors that far outweighed any domestic policy changes that contributed to the 90’s growth, such as the collapse of the Soviet Union).
So what does this have to do with Forex? Two things. First, this laid the foundation for Bretton Woods and the Euro. The Euro is practically a derivative of the US Dollar. That’s why countries such as the United Kingdom, Switzerland, Norway, and others – stayed out of the Euro. The Euro is the financial end result of the Marshall Plan which was designed to ensure the US Dollar was THE world reserve currency. Second, by seizing Germany as a vassal state, the US-UK “Axis” cemented its control over Europe, the highest economic prize across the pond. That’s because in Europe itself, Germany has always been the ‘strongest’ state, being the biggest producer and economic leader of Northern countries, whereas Southern Europe has been plagued by debt, complicated politics, and other issues (like African refugees floating to ‘the promised land’ or the Mafia hiding Nuclear waste in Italy & Ukraine, Terrorism (Real terrorism, not this ‘fabricated’ terrorism, etc.)
To add to the spoils of war, Project Paperclip brought top Nazi scientists (most notably, Von Braun) without which NASA programs in the past 60 years would not have been possible. Interestingly, this was also a period where the CIA was created, leading to the current global survelleince society we have today. Planned and organized in London, executed and accounted for in New York & Washington, all for the benefit of various international multi-ethnic owners (some American, some Dutch, Swiss, French, Italian, German, Russian, British, Israeli, etc.) Long story short, the Royal Elite evolved, they didn’t disappear (Think – Illuminati, vs. King Henry).
Fast forward to 2016 – during World War 2, IBM, the most sophistocated, largest, powerful computer company in the world was feeding the Nazi war machine. What are computer companies (think Google, Facebook, Microsoft) doing today in Europe? In London? Google, Facebook, Microsoft, all have strong relationships with the DOD (Department of Defense).
It was Hitler that first wrote famously the words “New World Order” – and now this same ‘goal’ is the solution to market microstructure illiquidity, volatility, wide spreads, and huge price swings? It seems that over the past 100 years really, not much has really changed, it is the same group of banks pulling our nose (historically speaking), whether they’re funding Hitler or Clinton, whoever wins, nothing seems to change. In war there are no winners, only victims. There’s a popular banking advertisement ‘banks compete – you win’ – it should be ‘When countries compete, banks win’ – and this is most obvious in the Forex market, where such a move in the GBP/USD can be a quick 10 or 20 yard-bagger for a major bank who is on the front of the order. And all this commotion- banking profits all the way to the New World Order!