AIIB will provide financial and ideological competition to the Washington institutions

The world is changing, and so is it in the banking industry. The Obama administration are concerned about the new superpower in the banking sector. It`s called AIIB, and the Obama administration has tried to stop other contries from investing in the new bank.

The reason why they have tried to stop AIIB, is because they are afraid that AIIB would undermine the power of the U.S dominated World Bank and the International Monetary Fund (IMF) in the emerging markets. So, what is AIIB, and should you be worried?

AIIB stand for The Asian infrastructure Investment Bank. It is an international financial institution proposed by the government of China. The purpose of the multilateral development bank is to provide finance to infrastructure projects in the Asia region.

 

AIIBMap.svg

(Picture: Prospective Founding Members (PFMs) of AIIB (2015-04-15 UTC+8 12:00:00)

  Blue dark: PFM which signed the memorandum to build AIIB
  Blue light: Approved as PFM of AIIB
  Green dark: Applying to become an ordinary member of AIIB
  Yellow: Application under consideration
  Red dark: No commitment to participate or rejected
  Grey: Uncommitted

 

The Bank`s foundation is built on the lessons of experience of existing MDB`s and the private sector. It`s modus operandi will be lean, clean and green; lean, with a small efficient management team and highly skilled staff.

Clean; an ethical organisation with zero tolerance for corruption; and green; an institution built on respect for the environment. The AIIB will put in place strong policies on governance, accountability, financial, procurement and environmental and social frameworks.

The AIIB, a modern knowledge-based institution, will focus on the development of infrastructure and other productive sectors in Asia, including energy and power, transportation and telecommunications, rural infrastructure and agriculture development, water supply and sanitation, environmental protection, urban development and logistics, etc. The operational strategy and priority areas of engagement may be revised or further refined by its governing boards in the future as circumstances may warrant.

AII B is regarded by some as a rival for the IMF, the World Bank and the Asian Development Bank (ADB), which are regarded as dominated by developed countries like the United States. The United Nations has addressed the launch of AIIB as «scaling up financing for sustainable development» for the concern of Global Economic Governance.

The United States officials have expressed concerns about whether the AIIB would have high standards of governance, and whether it would have environmental and social safeguards. The United States is reported to have used diplomatic pressure to try and prevent key allies, such as Australia, from joining the bank, and expressed disappointment when others, such as Britain joined.

As of April 15, 2015, almost all Asian countries and most major countries outside Asia had joined the AIIB, except the US, Japan (which dominated the ADB) and Canada. North Korea`s and Taiwan`s applications for Prospective Founding Member (PFM) were rejected.

The bank was launched at a ceremony in Beijing in October 2014. The Articles of Agreement (AOA) would be finalized and open for signature by PFM`s from June 2015. The AOA is expected to enter into force and AIIB to be fully established by the end of 2015. As of April 15, 2015 there are 57 PFM`s.

The World Bank and IMF which is dominated by Washington-based bureaucrats have had an ideological monopoly in the lending market since 1945. It all started in 1944, with the Bretton Woods Agreement.

Bretton Woods set up the World Bank and IMF duo, and provided subsidized competition to the merchant banks. This resulted in a situation were the merchant banks was driven out of the development lending business.

Lending to developing countries was carried out by the private sector before the World War II, notably by the London merchant banks. All this resulted in an attractive diversity of development banking approaches.

The problem for the recipients was that the people often got bad advice because there was only one source of long-term development capital. In the last decade, the landscape has been dotted with renewable energy projects.

Infrastructure is popular among development bankers, but it is very expensive. Huge amounts of money have been wasted over the past 70 years in attempting to develop poor countries on the basis of non-market fashionable theories from the rich West.

Africa became much poorer rather than richer from 1960 to 2000. The rest of the world became much richer, and IMF and World Bank cannot be blamed for that. The money funneled through them was both wasted and left recipient countries with often unbearable burdens of foreign debt.

The bombs the West have dropped in many Asian countries didn`t help either, and many of those countries will participate in the new bank AIIB. Some of them is Laos, Cambodia and Vietnam to name a few. Poor countries need money. Not bombs.

AIIB will provide financial and ideological competition to the Washington institutions.

This new model with Asian countries having a choice of funding sources (without Washington) will be beneficial, and the decisions will probably be free of the current Western «political correctness» doctrines.

It will be expensive and the new project will probably face huge losses to the institution concerned, but with India and Britain among its shareholders the new project will surely be one of its most benign manifestations. The multilateral development bank approach to developing poor countries has been proved over 70 years without any big success. Will AIIB change that?

It`s better with money and growth than bombs. The world can`t be held together by bombs and alliances.

 


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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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Eurovision Song Contest 2015

It`s time for the Eurovision Song Contest again. The program everyone loves to hate. The music and artists everyone is talking about. All the music they don`t like and what they like. Is it something Europe need now, it should be music.

The 2015 Eurovision Song Contest is held in the capital of Austria, Vienna, and this is the second time in history the city hosts the contest. The right for hosting the contest came when the artist Conchita Wurst brought home the trophy with her song «Rise like a Phoenix», from Copenhagen in Denmark the year before.

Eurovision2015

Wiener stadhelle is the arena for the song contest and the live show for the Grand final takes place on Saturday 23 May 2015. Viewers in 40 countries will have their opportunity to vote to decide the winner of the 2015 Eurovision Song Contest.

It is worth reminding you that this evening`s show is of equal significance, as this is the show that the professional juries will be watching and voting on, and they are responsible for 50% of the votes.

There are a record 27 songs and 40 juries.

I haven`t heard all the songs in the grand final, but I must admit that the best song I have heard so far is from Sweden. The song is called «Heroes» by Måns Zelmerlôw. Are Sweden really gonna be the winner again?

The Swedish song is good, but it`s not as good as the last Swedish winner sung by Loreen. I can hear the hit potential in the song, but it sounds like it isn`t finished yet. I  would change the bass drum and the sound of the refrain.  The song reminds me of the Swedish Avichii. In my opinion; a new mix of «Heroes» and voila, you have a monster hit.

A year full of downbeat ballads gives Sweden a great opportunity to win.

I`m familiar with Måns Zelmerlôw as the host at the program «Allsang på Skansen». A great program I`m watching every single year in the summertime. He did a great job as a host in that program and we know he has a great voice.

Sweden is doing something right.

Last time Sweden won was only three years ago, in 2012. Loreen won with the song «Euphoria» in Azerbaijan with 372 points, and some say it is the most popular Eurovision hit song of all time. That song is beating another Swedish song; Abba`s Waterloo.

That`s not to say that Abba have lost the love, the band`s Waterloo is the seventh most listened-to song in the top 10 most popular Eurovision hit song of all time. The figures have been compiled by music on demand service Deezer which measured the most popular Eurovision tracks streamed by its users, which means you should take that list as a pinch of salt.

I bet you can listen to the songs on Spotify too. A Swedish music streamer, which is the biggest of them all. Sweden is a Superpower in the music industry. They have so many great artists, songs, DJ`s and producers.

One of my favorite producers of all time is the Swedish DJ, music producer and songwriter Denniz Pop (Dag Krister Volle). The man who made hit songs for Backstreet Boys, Dr Alban, Ace of Bace, E-Type, Robyn, N`Sync and Britney Spears to name a few. He died of cancer at the age of 35.

Denniz Pop was a BIG HERO!

It`s time for music, glitter and barely disguised political tension on Saturday. It is also the 60th anniversary of the song contest, and Australia will take place on the stage this time. Well, Australia isn`t Europe. Is it? Nope, neither are Azerbaijan, Israel or Turkey. So, what`s going on?

According to Paul Jordan, «Eligibility to participate is not determined by geographic inclusion within the continent of Europe, despite the inference in the title of the competition». «Entry to the event is dependent on being a full and active member of the EBU (European Broadcasting Union).»

Romania`s song is a bit political. It is a song about millions of Romanians working abroad, sending remittances home. The band started a campaign delcapat.ro (alloveragain) supporting the children left alone by their parents who went to work outside the borders.

They are now connected with other majors in child protection non-profit organisations like Unitedway and Habitat for Humanity. This is an interesting choice at a time when free movement of people is causing heated debate in Brussels.

The show starts Saturday at 21:00 CET.

 


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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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Rolls Royce 2015

Rolls Royce is a huge brand and a huge presence in the UK. They directly employ over r 21,000 people, and through their supply chains and employee spending support around 106,000 people, which accounts for about one in every 300 UK jobs.

As we can predict, Rolls Royce is a very important brand in the UK, which generates annual sales of around £5,7 billion, three-quarters of which comes from exports, meaning that they are directly responsible for 2% of total UK goods exports, which means they are responsible for approximately £6 in every £1,000 of GDP generated in the UK.

Rolls Royce Wraith

(Picture: Rolls Royce Wraith Inspired by Fashion)

 

Over the past 20 years they have invested over £12,5 billion in research and development in the UK. They have invested in 19 University technology Centres at 14 UK universities, keeping their engineers at the forefront of scientific research.

Rolls Royce is out with a new car now. A new 2015 model which is looking so great. Awesome.

The new car is a V-12 coupe premiered as part of a special scholarship program conducted by Rolls Royce and the Pratt Institute. The Wraith is a 642-horsepower coupe, controlled by an eight-speed automatic transmission. You can imagine how it is to drive this car?

The Wraith is a two-door sports coupe with 2+2 seeting, and all the stitching is hand-sewn by seamstresses in Goodwood. The new car is designed by Michelle Lusby, which is the new upcoming designer at Rolls-Royce Motor Cars.

The interior is a stark arctic white and black onyx with embroidered headrests, a jewelry pearl-designed clock on the dash, and a two-tone steering wheel that Rolls`s seamstresses in Goodwood have figured out how to make look seamless.
Don`t expect to see hundreds of these on the road. Construction time takes one to three months on this limited edition. It depends upon clients interest.

The Wraith starts at a price of $294,000, but the special «Inspired by Fashion» model costs $362,000.

 


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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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Where is the gold?

Gold is very difficult to predict. Who knows how much gold USA have at the moment? Russia wanted to know for some time ago, but didn`t have access. What about China? How much gold do they have?

This is a big mystery right now.

Last time we heard something from China was back in April 2009, when they said that it owned 1,054 metric tons (mt) of gold. That is only 1% of its official foreign reserves, but it makes China the world`s sixth largest holder of official gold reserves, after the U.S, IMF, Germany, Italy and France.

What about the U.S? Do they have any gold left at all? Wait and see, because IMF (International Monetary Fund) will probably reveal the secret later this year.

Some gold is missing and where is it?

Gold_reserve_changes_1993-2014

(Picture: Change in US Gold Reserves 1993 – 2014)

 

It can be stored in different banks in China who have licenses to store them, and their gold stocks are not publicly disclosed. Second, it can be «on loan» to jewelry factories located around Shenzhen. This is how they did it in 2013 when the price of gold dropped 28 percent.

IMF and China are negotiating to have yuan or renminbi to be part of the IMF`s menetary reserve denominator. The Special Drawing Rights (SDR). I think that the IMF will come out with some news very soon that will make some investors nervous.

If China want to be a part of the elite club (Dollar, yen, pound and euro), they need to reveal how much gold they have as part of their reserves, and that is very important information investors have been wondering in many years.

Some people guess that China has about 3,000 mt, while others say 6,000 mt. China has replaced India as the world`s largest consumer of gold. They are the biggest importer, and the world`s biggest producer. One way to figure it out is to look at their trade data, domestic gold and numbers from China Gold Association.

As of March 2015, The biggest gold holder are the U.S with 8,133,5 tons. Nr. 2 is Germany with 3,384,2 and Nr. 3 is IMF with 2,814 tons of gold. Central banks stands for 17,2% of the world gold holdings. Investment (bars, coins) stands for 19,26%, while jewellery stands for 49,2%, according to United States Geological Survey (2011).

 

Us_gold_reserves

(Picture: US gold reserves and gold price)

 

The Federal Reserve hold the U.S gold, if they still has some left, but some gold lovers belive that the gold once backed the U.S currency is long gone. The gold has not been audited since 1953. But why are gold so important to China?

China want the world to see a stable renminbi, which means they need to back their balance sheet by gold than other fiat currencies. This is more actual now than never before, because all the central banks are «printing» money like crazy, making it unstable.

China`s currency renminbi is following the U.S dollar, but if their currency becomes a free-floating currency that will change. They will no longer follow the U.S dollar and their currency will not move on news from the Federal Reserve policy.

Renminbi has already surpassed the euro to become the second most used currency in international trade. China`s goal is probably to have all its trade settled in their own currency. As it stands now, every time the U.S dollar moves so does renminbi.

China`s GDP Growth rate expanded to a record low of 1,30 percent in the first quarter of 2015 over the previous quarter, according to the National Bureau of Statistics of China. China`s GDP annual Growth rate expanded 7 percent in the first quarter of 2015.

I expect more stimulus from China in 2015 despite better than expected results in Q4. The deflationary pressure persists and the slowdown in the estate market is expected to continue. China have more than enough to think about.

The higher the dollar goes, the lower renminbi goes. That`s good for the U.S consumers because they can buy cheap from China, but what about the rest of the world. What about Europe? Of course they will not buy so much anymore, because the prices are in dollar.

China`s export will drop and that`s not China`s goal. This is probably why they want more control over their currency? And here is where the gold comes in. What are China thinking about gold and their own currency? IMF will probably give us the answer very soon?

If everything goes to plan, China will reveal its gold holdings later this year and that will move the markets. The first IMF meeting will take place now in May and the second meeting later this year. The gold price will move up or down, but it depends on the news.

The financial system of the West CAN be destroyed overnight. It will be very expensive if the gold goes up. Can we afford it?

Next meeting is in Q4 2015.

 


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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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