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Ben Davies continues:
“All of this is a bit of a ruse really. We were sitting on the desk and we believe, absolutely, that this is a form of quantitative easing. It is quantitative easing. Actually, it’s very clever because they’re giving a term period. So they are talking about loaning to the banks for a two year period, in return for collateral, as I just suggested, with a diminished quality.
So it’s qualitative easing and it’s very clever because it deals with some of the debt rollover issues for the banks. It’s funny, I was going to come on the air and debate out loud the quandaries that I have about the system. That was to say, I am really caught at the moment because there’s just not enough capital available to sort this mess out.
Over the last six months I feel that we’re in a situation where the fiat currency system is so tenuous and feeble, that actually we can’t just pull the rug from under the system because it will collapse. Economic collapse will ensue and society, with order, will break down....
Continue reading the Ben Davies interview below...
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“The ECB knows, and the governments understand they need to recapitalize the banks. They need to get the credit transmission working because interbank lending has completely failed. This is very clever and it also helps these banks meet Basel III provisions. Look at it this way, they will be able to sell these bad assets to the ECB in return for cash, potentially for two years. That deals with the debt rollover situation.
It gives a firm date on quantitative easing, in this case qualitative easing. The balance sheet of the ECB will rise. This will put more money into the system, more cash. No doubt the banks, and this is the clever bit, the banks will no doubt have to go out and buy some of this sovereign debt because they need to recapitalize to meet Basel III. So it’s a win/win situation for sovereigns and for the banks, and the whole system just keeps going.”
When asked what problems he sees with the scheme, Davies stated, “Well, despite how ingenious this is, this is all about furthering the Ponzi scheme...It’s a bit like the Madoff scheme. The reason why the Madoff scheme failed was because he was having more redemptions than he was having subscriptions. The deleveraging of 2008 was the death knell for him and that’s what we are experiencing now in the system. Unfortunately this is just kicking the can down the road.”
The KWN interview with Ben Davies will be available shortly and you can listen to it by CLICKING HERE.
© 2011 by King World News®. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. However, linking directly to the blog page is permitted and encouraged.
Eric King
KWN Special - Ben Davies: ECB To Engage in Qualitative Easing
With so much fear and uncertainty in markets around the world, today King World News interviewed Ben Davies, CEO of Hinde Capital. Davies alerted KWN to some key developments in Europe. When KWN brought up the breaking news in Europe, Davies stated, “Indeed we do, Eric, just before we came on (for the interview) there was some leaked information on the news wires and it was about the ECB potentially discussing how they could stimulate bank lending. They suggest they possibly will loosen collateral criteria so the institutions can have cheaper access to ECB cash. They would be offered it (cash) as a longer-term loan.”
© 2011 by King World News®. All Rights Reserved. This material may not be published, broadcast,
rewritten, or redistributed. However, linking directly to the blog page is permitted and encouraged.
December 8, 2011
