4/23/2022

Russia and China launching financial war against the Americans

 It's not just a military confrontation; Russia & China are about to launch the financial war to take down the USD:


'Russia, China and the members, associates and dialog partners of the Shanghai Cooperation organisation appear to understand the dangers to them from a currency collapse of the dollar, other Western currencies and of associated financial assets. There are three pieces of evidence that this may be so. Firstly, China responded to the Fed reducing its funds rate to zero and the introduction of monthly QE of $120bn in March 2020 by stockpiling commodities, raw materials, and grains. Clearly, China understood the implications for the dollar’s purchasing power. By backing its economy with commodity stocks she was taking steps to protect her own currency from the dollar’s debasement.

Secondly, sanctions against Russia rendered the dollar, euro, yen, and pounds valueless in its national reserves. At the same time, sanctions have pushed up commodity prices measured in those currencies. Russia has responded by insisting on payments for energy from “unfriendly nations” in roubles, while the central bank has resumed buying gold from domestic producers. Again, the currency is reflecting its commodity features. And lastly, the Eurasia Economic Union, which combines Russia, Armenia, Belarus, Kazakhstan and Kyrgyzstan, has proposed a new currency in conjunction with China.

Details are sketchy, but we have been told that the new currency will combine the national currencies of the nations involved and twenty exchange-traded commodities. It sounds like it will be a statist version of earlier gold standards, with perhaps 40-50% commodity backing, presumably to be fixed against national currencies daily. Like the SDR, it will be supplemental to national currencies, but used for cross-border trade settlement. The involvement of both China and Russia suggests that it might be adopted more widely by the Shanghai Cooperation Organisation, representing 40% of the world’s population and freeing them from the dollar’s hegemony.

The original motivation was to remove a weaponised dollar from pan-Asian trade, but recent developments have imparted a new urgency. Rapidly rising prices, in other words an accelerating loss of the dollar’s purchasing power, amounts to a transfer of wealth from dollar balances in Asian hands to the US Government. That is undesirable for the EAEU members. Furthermore, the flaws in the yen and the euro have become obvious as well. All Western currencies will almost certainly be undermined by their central banks’ resistance to rising bond yields as the John Law experience Mark 2 plays out.

It might prove impractical for westerners to access this new currency to escape the collapse of their own national currencies. Anyway, a new currency must become established before it can be trusted as a medium of exchange.'

https://www.goldmoney.com/research/goldmoney-insights/value-destruction

Anonymous 

9 comments:

Anonymous said...

Roubles for Resources:

US Treasury Secretary Janet Yellen said on Thursday that a complete European ban on Russian oil and gas imports would “clearly” raise global oil prices and may inflict harm on Europe and other parts of the world.
Speaking to reporters following a meeting with Ukrainian Prime Minister Denys Shmyhal and Finance Minister Sergiy Marchenko in Washington, Yellen said that such a ban could ultimately cause more harm than good. “It could actually have very little negative impact on Russia, because although Russia might export less, the price it gets for its exports would go up,” she said, as quoted by AFP.
This doesn't require any commenting because it is self-evident, this is how the geopolitical defeat of a century looks like. It is also the end of the US Dollar as a fait accompli.

The military part of this is happening now in Ukraine, with Russian forces continuing to physically annihilate the remnants of VSU. Russia has all the time on her hands she needs, if any one wonders about timing. The mode of the old bull from the famous anecdote is "ON".'

https://smoothiex12.blogspot.com/

Anonymous said...

The US$ is backed by 'fart'. The Ruble and Yuan may move next into being backed by gold. If that happens, which currency would countries want to hold as reserves? And if that happens, what is going to happen to the US$?

As for digital currencies being claimed to be backed by gold, I am not too sure. Paper gold? I got burned trusting paper gold years ago.

Anonymous said...

NATO is fragmenting. France and Germany are being accused of selling weapons to Russia and breaking sanctions. It is claimed that those weapons are now being used by Russia in Ukraine. In fact some other NATO countries were also breaking sanctions by doing the same.

Well, isn't this also the modus operandi of the USA as well? They coerced the Europeans to ban import of oil and gas from Russia, but the USA, behind their backs imported more oil, 43% more, from Russia recently. Russia and China were sniggering at the stupid Europeans for listening to the untrustworthy USA.

Anonymous said...

Aiyo Anon, your info is outdated by several years. What weapon sales are you talking about? Russians are too proud to use western designed weapons. They bought 2 French Mistral ships (only structure), and advanced commercially available technology (imaging and navigation) which they adapt for military use.

Less than 1% of US oil imports is from Russia. They were the 1st country to ban russian oil. The 43% increase (100k barrels) was bought through a trader on the open market during one week in Mar, and amounted to less than 1 hour usage.

All this can be easily verified. By all means, criticize the angmo, but let's not bullshit ourselves.

Angry in Bishan said...

Good news friends. You can still buy rubles at 2 of the moneychangers at the Change Alley. If you believe US$ not very good in the long run, we can keep small amount say 10k-20k in rubles. I myself have about 10k. Yes, you don't get interest for keeping cash, but then OCBC also give almost nothing on FD. CCB.

Anonymous said...


'Hua Ping, a senior researcher at a think-tank led by a former PLA Major-General, recently stated: “The China-US showdown is not a question of if, but of when, how, and on what scale. We must not only forsake the delusion of a "peaceful rise" free of struggle, but we must also abandon the unfulfilled aspiration to achieve reunion solely through peaceful means.”

He added:

”The issue of Taiwan is a duel of fates that concerns the rise and fall of the country and the survival of the nation.” That sounds very Russia-Ukraine. Worse, “America's growing paranoia about its declining hegemony may force it to make a desperate move, like a cornered dog. Our window of opportunity to take action against the US is closing. We must urgently prepare to recover Taiwan before, not after, the Sino-American showdown.”

In his eyes, the US will fight China both militarily and via: “1) financial strangulation; 2) cyber paralysis; 3) biocide - a desperate attempt to begin a genocidal war with clandestine, low-cost but highly lethal biochemical weapons; and 4) political manipulation.” Yet even tacitly admitting that a naval blockade would be on the cards(?), and after watching sanctions against Russia, the key conclusion was “…to deliver a devastating blow and achieve the battle's objectives in the shortest amount of time.”

https://www.zerohedge.com/markets/everyone-has-plan-until-they-get-punched-face-and-everyone-being-punched-face

Anonymous said...

It is not the sale of weapons by France and Germany that is at the crux of the matter. It is breaking of the sanctions at that time that matters.

Bought from a trader in the open market is still buying Russian Oil. No? If others do it that way, that country and the trader will be threatened and warned about facing serious consequences. Right?

Anonymous said...

https://www.rt.com/russia/554166-international-law-military-operation-ukraine/
23 Apr, 2022 19:08
Daniel Kovalik: Why Russia's intervention in Ukraine is legal under international law
The argument can be made that Russia exercised its right for self-defense

Justice Pao said...

Anon 5.12 - That is ownself approve ownself. LOL!