world money markets, ( Secret War? )

Two excellent reads:
Europe and the West are trying to improve short term liquidity.Expand.
( Linked to sub-prime loans, and ? )
The cost to borrow in euros plunged after the European Central Bank added an unprecedented $500 billion to the banking system as part of a global effort to ease credit-market gridlock through year-end.

China is trying to curb "excessive liquidity".Contract.
The Chinese government, which spent 2007 trying to prevent the country's economy overheating, caught investors on the hop this week with the sixth interest rate rise of the year, adding to indications that it will intensify its efforts to cool the economy in the coming 12 months.

They both speak of a 7 yr, time frame.

The biggest concerted effort by central banks in six years to restore confidence in global money markets is showing little sign of success. SOURCE:

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China's Economic view of USA.

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NEW YORK (AP) -- Wachovia Capital markets analyst Douglas Sipkin on Monday lowered his fourth-quarter estimate for Merrill Lynch & Co., forecasting a loss on further expected writedowns of collateralized debt obligations.
Dec. 25 (Bloomberg) -- Merrill Lynch & Co. will receive a cash infusion of as much as $6.2 billion from Singapore's Temasek Holdings Pte. and Davis Selected Advisors LP. Merrill Lynch & Co., reeling from the biggest loss in its 93-year history, will receive a cash infusion of as much as $6.2 billion from Singapore's Temasek Holdings Pte. and Davis Selected Advisors LP.

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Who is draining liquidity?
"CPI is going to be very important. The Fed has injected massive amounts of liquidity and they don't seem to be getting any major impact. We still have a credit crunch," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont.

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Paradigm Intel, and inductive reasoning indicates the possibility of a Global monetary cash flow problem. Currently focused on short term liquidity, it has the momentum to spread.
China is heavy and the West & Europe are short?

$100 bbl oil is accumulating significant economic pain world wide.

A publication by GIMF—an analysis of the global strategy of Al-Qaeda—is even more lucid. Under the title "Al-Qaeda's War is Economic not Military," wonders if there have been any strange or unusual transactions by world players.

All of this points to at least a recession. And maybe some manipulation, intentional or not.

USA DOESN'T KNOW WHAT IS CAUSING THE LIQUIDITY PROBLEM?

Possibilities:
1) Large country pulling funds.
2) Sub-prime some how affecting money markets
3) Derivatives based on Money Market rates: crashing?

Any other explanations? comment please.


Gerald