AUTOPSIES NOT NEEDED

Call it kick the can, turning a tone-deaf ear to the Pied Piper or whatever you want. It's always the same and China is no different.

For what it's worth a group of UBS economists noted that China's current projected growth is for 6.2%. However, they postulated that if it fell to 4%, certainly a possibility, not a guarantee, it would hack 0.5% off U.S. growth, nearly 1% of Europe's and more than 2.5% off of Japan's growth. Figures that hardly conjure a picture of isolation.

Only to those who want you to believe it's different this time like those who claim what goes on in Chinese markets stays there. Just recently, a not so subtle effort to aggrandize more financial turf, the Fed is putting out feelers--some would call them warnings--about implementing a 40-year old global rule about margin. Of course, as always, they're doing this for our benefit.

Here's today's WSJ description of the move, but for those who know, as pointed out, their margin history, it's an extension of power and control, not simply restoring the old rule.

WASHINGTON—The Federal Reserve is dusting off a legal power it has largely ignored for four decades, a move that could significantly expand the Fed’s influence over financial markets.

Margin requirements—rules limiting what portion of stocks or bonds can be purchased through borrowing—are moving up the Fed’s to-do list as officials fret about whether they have adequate tools to suppress dangerous asset bubbles that could lead to another financial crisis. They also allow the Fed to exert influence on all financial firms, not just banks.

A little-noticed global agreement recently paved the way for the central bank to move forward with plans to alter margin requirements. Under the accord announced Nov. 12, regulators representing 25 economies agreed to adopt rules similar to ones the Fed is developing, a united front intended to prevent financial firms from moving transactions offshore in response to tighter Fed rules.

First we create those massive bubbles and then we suppress them. And they way we do that, folks, is give them more powers. That's sounds like a party most of us would like to call our own. There a subtle point buried therein and it's about those who want to foster the idea that what happens stays in China, "a little-noticed global agreement." That 25 nations are concerned about a massive meltdown puts the lie to the China isolation meme and if that doesn't frighten you, the term regulators from 25 economies should. We hope they didn't include any from Greece.

Whether you recognize it or not, this is a close cousin the the recent inversion uproar. Make no mistake this is a circling of the wagons, a tightening of the global garrote around your financial liberty and freedom. Sit on your hands too long and you won't need an autopsy.