Former BIS chief economist: world is dangerously unanchored

[old steel]

The race to the bottom



The economic prophet who foresaw the Lehman crisis with uncanny accuracy is even more worried about the world's financial system going into 2015.



Beggar-thy-neighbour devaluations are spreading to every region. All the major central banks are stoking asset bubbles deliberately to put off the day of reckoning. This time emerging markets have been drawn into the quagmire as well, corrupted by the leakage from quantitative easing (QE) in the West.



"We are in a world that is dangerously unanchored," said William White, the Swiss-based chairman of the OECD's Review Committee. "We're seeing true currency wars and everybody is doing it, and I have no idea where this is going to end."




http://www.telegraph.co.uk/finance/economics/11358316/Central-bank-prophet-fears-QE-warfare-pushing-world-financial-system-out-of-control.html


So the question begs. When do you see this war going 'hot'?

[Serpo]

http://image.shutterstock.com/display_pic_with_logo/5024/5024,1118742779,8/stock-photo-a-d-bryce-rendered-picture-a-chained-world-anchor-point-372458.jpg

[Sparky]

...
So the question begs. When do you see this war going 'hot'?

The Swiss Franc move was really the opening salvo of the currency war going more public, i.e. "getting real". Switzerland in recent history has been the world's "honest broker". So the underlying message to a move like this will be taken very seriously. And the underlying message is the fiat warning that we have been talking about here for years.

Today Canada unexpectedly dropped its interest rate. Who's next? The big bomb would be China de-pegging the Yuan. I think they're going to save that one for bringing the system to its knees, probably to kick the Japanese Yen off the cliff and send the U.S. dollar reeling. That's still years away. But clearly, the next Act of the currency drama is now unfolding.

It wasn't clear whether the Euro or the Yen would fall first. It's looking like the Euro.

[Serpo]

Wasnt it Lindsay Williams.............first euro then yen then dollar in that order............