The Semantics and Pervasiveness of Hegemony
Lerner asks: "Thank you again for these articles, Nattering Naybob. These charts do not include balance sheet expansions by other major central banks. Might they have any influence in the liquidity reaching the stock market?"
The Nattering One muses: "Might they have any influence in the liquidity reaching the stock market?"
Its a matter of semantics, granularity and pervasiveness... IMO, a central banks "influence" over market liquidity is limited to the EXTENT of their own monetary supply and instruments denominated as such, that are "in play", as in issuance and circulation. In some cases, this assumes "coordination" with the issuing authority i.e. US Treasury.
Examples: US dollars, UST's, MBS, Agency and other collateral under Fed influence. "Indirectly" under Fed influence: UST's globally; ED eurodollars (dollar deposits in foreign banks) and ALL other financial instruments used to transact that are denominated in that currency (derivatives, etc.).
In the indirect circumstances, the central banks may lack granular control due to non regulation and/or outside of their purvey. We use the term indirect because in some cases, they have conveniently overlooked the effects that internal monetary policies have on those external markets. i.e. ED.
In the end, the EXTENT (or pervasiveness) to which your "dollar" is utilized to transact determines the weight and sphere (or scope and scale) of your potential "influence" in global markets and the liquidity thereof.
Speaking of EXTENT
Hubba, hubba, who do you trust? The Greenback....the US dollar now commands:
Almost 100% of global oil and energy transactions
90% of global FOREX transactions
80% of international trade finance transactions
63% of commodities contracts
60% of foreign currency reserves of the world’s central banks
60% of banks’ cross-border liabilities
That's why we are the 800 pound gorilla on the block, and anyone that attempts to challenge our hegemony, gets viciously pummeled into submission or death. A short list of recent victims who have challenged our hegemony and have either suffered economic reprisal, outright sanctions or been hunted down like dogs and incarcerated or terminated:
Manuel Noriega (Panama)
Moammar Kadafi (Libya)
Saddam Hussein (Iraq)
Osama Bin Laden (Al-Qaeda)
Iran
Ukraine
Russia
Belarus
China
Venezuela
Syria
Sudan
Somalia
Congo
North Korea
Lebanon
Cuba
Burma
The Nattering One muses: "Might they have any influence in the liquidity reaching the stock market?"
Its a matter of semantics, granularity and pervasiveness... IMO, a central banks "influence" over market liquidity is limited to the EXTENT of their own monetary supply and instruments denominated as such, that are "in play", as in issuance and circulation. In some cases, this assumes "coordination" with the issuing authority i.e. US Treasury.
Examples: US dollars, UST's, MBS, Agency and other collateral under Fed influence. "Indirectly" under Fed influence: UST's globally; ED eurodollars (dollar deposits in foreign banks) and ALL other financial instruments used to transact that are denominated in that currency (derivatives, etc.).
In the indirect circumstances, the central banks may lack granular control due to non regulation and/or outside of their purvey. We use the term indirect because in some cases, they have conveniently overlooked the effects that internal monetary policies have on those external markets. i.e. ED.
In the end, the EXTENT (or pervasiveness) to which your "dollar" is utilized to transact determines the weight and sphere (or scope and scale) of your potential "influence" in global markets and the liquidity thereof.
Speaking of EXTENT
Hubba, hubba, who do you trust? The Greenback....the US dollar now commands:
Almost 100% of global oil and energy transactions
90% of global FOREX transactions
80% of international trade finance transactions
63% of commodities contracts
60% of foreign currency reserves of the world’s central banks
60% of banks’ cross-border liabilities
52% of governments and corporations foreign currency debt
That's why we are the 800 pound gorilla on the block, and anyone that attempts to challenge our hegemony, gets viciously pummeled into submission or death. A short list of recent victims who have challenged our hegemony and have either suffered economic reprisal, outright sanctions or been hunted down like dogs and incarcerated or terminated:
Manuel Noriega (Panama)
Moammar Kadafi (Libya)
Saddam Hussein (Iraq)
Osama Bin Laden (Al-Qaeda)
Iran
Ukraine
Russia
Belarus
China
Venezuela
Syria
Sudan
Somalia
Congo
North Korea
Lebanon
Cuba
Burma
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