YOU DECIDE

We continue to write about what many want to overtly deny, currency wars.

Countries are no different from people. Most will not sit sidle when threatened. The present mess currently called Greece is an example irrespective of the debate. There are other examples. Just before the super rich convened their annual party in Davos reports surfaced how widely disgruntled many felt.

Confidence and respect for elected officials around the globe is sinking faster than a leaky boat. A recent report in the U.S. showed confidence in Congress at all time lows. The same holds for other institutions like MSM.

Most people now suspect research whether its about markets, unemployment or climate change. Many now realize much of it is produced to serve those who paid for it and little if anything about accuracy and truth.

People are beginning to have a much better idea of what's going on than any other time in history, thanks in part to the Internet. For the establishment crowd that a dangerous turn. Central bankers are part of that establishment.

What many fail to discern is, "Doing what it takes" is about as financially dangerous as it gets because the flip side of that is starting currency wars. Push beget push back, not pull.

Here's just one more warning about currency wars.

SOURCE: ZERO HEDGE

Merv "The Swerv" King - former governor of The Bank of England - has joined the ranks of thoseex-central-planners-who-feel-the-need-to-protect-their-legacy-by-rewriting-history-and-admitting-the-entire-thing-is-crazy. Speaking in Tokyo overnight, King said he’s concerned that financial markets believe real interest rates will remain very low for a very long time which has created "a significant disequilibrium in the world economy," adding that he does "not believe and expect a market economy to thrive on real interest rates that are close to zero." Warning that many nations realize "they have pushed monetary policy as far as it can go," King added that with the additional risk of currency wars, "markets will discover that they have been pushing asset prices to an excessively high level and there will be a major downward shock to asset prices."

As Bloomberg reports, Former Bank of England Governor Mervyn King says central banks and governments are becoming more and more strident in their determination to talk down their exchange rates.

“Many countries today can see that they have taken monetary policy as far as they can go.”

“Exchange rate policy may now become an instrument of monetary policy.”

“Since exchange rate changes are a zero sum game, there is a risk of currency war.”

King says disequilibrium in world economy is causing chronic weakness in demand

The must be addressed, says King, noting that monetary and fiscal stimulus may not be able to bring a recovery unless the disequilibrium is addressed

King also explained that he’s concerned that financial markets believe real interest rates will remain very low for a very long time.

“They may be right, they may be wrong,”

“If they are right, I think we have a significant disequilibrium in the world economy. I do not believe and expect a market economy to thrive on real interest rates that are close to zero.”: King

“If they’re wrong, then at some point markets will discover that they have been pushing asset prices to an excessively high level and there will be a major downward shock to asset prices and with debt levels fixed in nominal terms, that could cause some serious problems at some point in the future.”: King

Former central bank chief or not, King is obviously just one guy. So it's just as obvious that the in-crowd will claim the disgruntled-lone wolf defense to marginalized him or anyone else who bothers to question their tactics.

By the same token it's most likely much more dangerous to speak up now than at any other time. So we'll leave you for now while you enjoy the Super Bowl with one of our favorite sayings: 

You decide.