Economic Bubbles About to Burst

1989 Phillipines (13)Insider selling by billionaires – including Warren Buffett and John Paulsen – this week indicate something big is about to happen, something that may make the 2008 credit crisis seem rather benign.  Last week the governments of Russia and Germany called in their gold being “held” by the New York Federal Reserve.A couple of years ago the IMF announced that it would begin liquidating its gold holdings- the world’s 3rd largest stash after the US and Germany.  Buyers included the governments of India, Sri Lanka and Mauritius.  Do you think the IMF would be selling gold at a market bottom?  Bubble #1 about to burst – Gold.

Both Venezuelan and Vietnamese governments announced devaluations of their currencies, striking fear into the hearts of Southeast Asian governments, who fear a repeat of the 1997 Asian Crisis.  Vietnam has benefited from the highly speculative dollar carry trade, through which investors borrow US dollars at near 0% interest, then reinvest those free dollars in 12-13% Vietnamese bonds.  Much of the money which we forked over to Wall Street banks via QE 1-3 has made it’s way into these speculative markets, rather than being loaned to US home buyers, for example.  Bubble #2 about to burst – The US Dollar Carry Trade

Another financial shock came out of Dubai, where the overbuilt property sector is reeling.  Dubai is one of five emirates ruled by undemocratic monarchies which make up the United Arab Emirates (UAE).  The UAE only got its independence from Great Britain in 1973.  As the Vietnam War wound down, the Golden Triangle (Thailand, Burma, Laos) heroin trade found a new home in the Golden Crescent (Afghanistan, Pakistan, Iran).  And Afghanistan became a permanent war zone.  Hong Kong had been built up as the banking center for the SE Asian guns/drugs/oil/war reconstruction trade.  Now Dubai serves that same purpose – first for Afghanistan and later for the war in Iraq.

The Dubai financial scene is dominated by the very same two British old money banks who control Hong Kong  – HSBC (the world’s 2nd largest bank also known as Hong Kong Shanghai Banking Corporation) and Standard Chartered.  As discussed in my book Big Oil & Their Bankers…, these banks were launched by proceeds from the British Freemason’s opium wars on China in the mid-1800′s and are controlled by blue-blood British aristocratic families such as Swire, Inchcape, Jardine Mathesson, Keswick and Rothschild.

On September 10, 2001, Mohammed Atta received a $100,000 wire transfer from a Standard Chartered account in Dubai controlled by the head of the Pakistani ISI intelligence service.  Pakistan is home to the Agha Khan Foundation, which was launched by British Intelligence during the partition that same year of Pakistan and Bangladesh from India.  Agha Khan is considered the spiritual leader for Muslim fanatics worldwide, including the Muslim Brotherhood and al Qaeda.

It gets more interesting when you discover that the Agha Khan Foundation is a wholly-owned subsidiary of Crown Agency – a branch of the British Crown.  And that this same Crown Agency also owns Securacom- the company that had the security contract on the World Trade Center.  And that Marvin Bush – Georgie the traitor’s brother – was the CEO of Securacom.  Do you think it is a coincidence that the world’s tallest building is now the Burj Dubai?  Or that Halliburton moved its headquarters to Dubai?

So when Dubai Ports, the emirate’s biggest financial concern announced a couple years ago that it would suspend payments to its creditors- HSBC and Standard Chartered- it rocked the financial world.  The British Crown had trusted their al-Maktoum monarch pals in Dubai, even threatened Americans that they would shift the global second-in-line (let’s not forget London is #1) financial hub from New York to Dubai.  Now the sheiks were broke.  And the British masters of the universe bankers would be left holding the bag. Booh! Hooh!

So why does this matter? Dubai was perhaps the most dramatic attempt by the international bankers to reflate the global economy. It was the old “war is business and business is good” trade. And it is over. With US troops gone from Iraq and the Afghan quagmire winding down, the glittering Rothschild-inspired Dubai – built on of blood, drugs, gold and oil – is set to collapse.  Bubble #3 about to burst – The Global Reflation Trade.

With Dubai’s collapse will go the gold market, the dollar carry trade and the global reflation trade.  Global deflation, Japanese-style, looks set to take hold.  The dollar should rebound sharply.  The housing market will see another leg down.  The stock market will go through the March 2009 lows like a knife going through butter. On the positive side, it could mark the end of a global economy dependent on war profiteering and, if we play our cards right, an end to the global banking monopoly.

Dean Henderson is the author of five books: Big Oil & Their Bankers in the Persian Gulf: Four Horsemen, Eight Families & Their Global Intelligence, Narcotics & Terror Network, The Grateful Unrich: Revolution in 50 Countries, Das Kartell der Federal Reserve, Stickin’ it to the Matrix & The Federal Reserve Cartel.  You can subscribe free to his weekly Left Hook column at


4 responses to “Economic Bubbles About to Burst

  1. Most certainly, that’s why I live in the country, own my own home, have no debts and grow a garden.
    I think it’s also important to live by or near fresh water, because water will stop flowing in taps as can already be seen in Detroit.
    This will happen even if people are paying their water bill because the entire infrastructure will collapse.

    What concerns me is when the infrastructure collapses is: what will happen to all the dams that were built so shabby that, they need to be fixed 24/7 in order not to burst? they will most certainly burst which is why I don’t live near one that will affect my property.

  2. corp bonds! the benefit of owning something that cant possibly go anywhere but down is possibly mis priced from the fact 0f being il rationally unloved and money! I like owning corp bonds at these depressed YTM’s. the possibility of default MAY be already priced in and the company will find it easy to honor the schedule come interest payment time? did I happen to say MONEY like collateral and more readily physical? your time frame is however compressed. the abilty to exchange debt in China for gold will continue to hold the commodity/arms race together and we continue to obey the corp/government controllers? all this printing can and will be absorbed and any interest paying credit will be much harder to find in the near future. the ability of the German/American/China money union will only grow more powerful because of lower gold prices? everybody loves these currency bands at any levels and breaking them is proving impossible? the usury bubble never bursts!


  4. The only thing ‘bad’ that is about to happen is interest rate increase by the Fed. And that is not such a bad thing. Wall St speculators have had an unprecedented run of ‘free’ gambling – it was bound to end.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s