GayPatriot

The Internet home for American gay conservatives.

Powered by Genesis

Update: China-Russia’s open dollar bypass

May 27, 2014 by Jeff (ILoveCapitalism)

While China, Russia and Iran may not be natural allies, “the enemy of my enemy is my friend” and they’re getting together to oppose the U.S. I’ve suggested before that President Obama’s efforts to isolate Russia are only goading these countries in their ongoing efforts to create a non-U.S. system for world trade and finance, a system that other countries (Germany, other BRICs, etc.) would come to do business with. Eventually bringing about the decline (or overthrow) of the U.S. dollar as the world’s key currency.

For my earlier posts on this, see here, here, here, here and here. The last was six weeks ago. What’s happened since?

  • BRICS countries are still setting up a Development Bank, like the IMF and World Bank but serving their own interests. It “will begin operating as soon as in 2015…The currency reserve pool will assist a member country with resolving problems with its balance of payments” – such problems as, oh, the U.S. trying to undermine Russia’s economy.
  • Russia has dumped 20% of its U.S. Treasury bond holdings. (It will be more significant when China does it, but there it begins.)
  • China has slammed Obama’s sanctions against Russia.
  • China and Russia deepen their ongoing military ties, such as a joint naval drill which they held a few days ago.
  • China and Iran announce plans to deepen their military ties. “According to an Iranian news report, [China’s Defense Minister] Chang also said that China views Iran as a strategic partner.”
  • A top EU Commissioner warned that “Any ‘sensible’ European Union citizen should oppose further sanctions on Russia because of the economic cost for Europe.” More recently, Germany’s Finance minister implies that the U.S. is a poor partner.
  • If you believe the Voice of Russia (which tends to spew propaganda), Russia is reviving the GECF (like an OPEC for natural gas) with help from Qatar and other gas-producing countries. Also, Russia intends to use ruble/yuan instead of dollars in its energy trading.
  • Putin opens Russia to greater Chinese investment. And large Russian and Chinese banks work out deals to settle payments in ruble and yuan, rather than dollars.
  • A huge step forward for Russia and China: They finally sign their big natural gas deal. It’s worth $400 billion over 30 years, took a decade to negotiate and will involve tens of billions of joint capital expenditure by the two countries (e.g., new pipelines).
  • “Russia may sign an agreement to build 8 nuclear reactors in Iran.” In other words, Russia views Iran as a strategic partner, and strives to help Iran’s nuclear program.
  • In an interview, Putin says the ‘unipolar’ world order has run its course – and much more.

The non-U.S. dominated world: bit by bit, it’s coming.

Hat tip to Zero Hedge, which has long covered this story and furnished several of the above links.

Filed Under: Anti-Americanism Abroad, Economy, National Security, Obama Incompetence Tagged With: Anti-Americanism Abroad, brics, china, Economy, gecf, Iran, National Security, natural gas, Obama Incompetence, russia, u.s. dollar

The dollar’s removal proceeds apace

April 2, 2014 by Jeff (ILoveCapitalism)

Like aging, the overthrow of the U.S. dollar (as the key world currency) is a gradual process. In the last month, I’ve blogged on Russia as a U.S. financial opponent, growing ties among the BRICS nations, and growing Germany-China ties, all tending toward the decline (or eventual elimination) of the dollar from those countries’ relationships with each other.

Today it’s growing Russia-Iran ties (that remove the U.S. dollar from their partnership):

(Reuters) – Iran and Russia have made progress towards an oil-for-goods deal sources said would be worth up to $20 billion, which would enable Tehran to boost vital energy exports in defiance of Western sanctions, people familiar with the negotiations told Reuters.

In January Reuters reported Moscow and Tehran were discussing a barter deal that would see Moscow buy up to 500,000 barrels a day of Iranian oil in exchange for Russian equipment and goods…

[A] source said the two sides were looking at a barter arrangement that would see Iranian oil being exchanged for industrial goods including metals and food…

The Iranian official said missiles would also be part of the deal, together with Russia providing assistance with building two nuclear plants in Iran…

Missiles? Yikes! But this is what you can expect, with Jimmy Carter President Obama at the helm. He should have assisted Iran’s (aborted) Green Revolution back in 2009-10, when he had the chance.

Hat tip, ZH.

Filed Under: Debt Crisis, Economy, Green Revolution in Iran, National Security, Obama Incompetence Tagged With: Debt Crisis, Economy, Green Revolution in Iran, Iran, National Security, Obama Incompetence, russia, u.s. dollar

A conversation I keep having with people

March 29, 2014 by Jeff (ILoveCapitalism)

Other: How ’bout that economy?
Jeff: The U.S. dollar’s days are numbered. I don’t know when, but sometime in the next five years (and maybe even beginning as soon as this year), the dollar will be kicked out as the key world currency.
Other: That’s crazy. We’re Number One. Other countries need us to trade with.
Jeff: Not necessarily. In fact, it would be good for other countries to keep more goods for their own people, rather than sending them to us just for our crappy paper dollars.
Other: But dollars are how you, like, buy stuff. Countries will always need dollars.
Jeff: Why? They can set up payment and trade systems in their own currencies, without us. And stupid Obama is helping to push Russia, China and India together as we speak. That’s half the world.
Other: But Germany and Japan will stick with the U.S.
Jeff: Really? Why? Japan is a sinking ship. Germany isn’t, but Germany traditionally does business with Russia and China. They could wake up and re-align at any time.
Other: That’s crazy. Germany has been pro-U.S. for 70 years. They’ll never change.
Jeff: Hmm, why are you so sure?
Other: How ’bout them Niners? It’s been raining cats and dogs.

Now consider this news item: Bundesbank, PBOC in Pact to Turn Frankfurt Into Renminbi Hub.

Germany’s Bundesbank and the People’€™s Bank of China agreed to cooperate in the clearing and settling of payments in [China’s] renminbi…

The central banks signed a memorandum of understanding in Berlin today…

“Frankfurt is one of Europe’s foremost financial centers and home to two central banks, making it a particularly suitable location,” said Joachim Nagel, a member of the Bundesbank’s executive board. “Renminbi clearing will strengthen the close economic and financial ties between Germany and the People’s Republic of China.”…

In a sign of closer economic ties between the two countries, China plans to open a fourth consulate in Germany…About 800 Chinese companies have bases in North Rhine-Westphalia, Germany’s industrial heartland…

German companies including Siemens AG, the country’s biggest engineering company, and Volkswagen AG are embracing the renminbi internally as a third currency for cross-border trade settlements…

This isn’t new; it’s a trend. China has been inking pacts with country after country in the last five years, so they can stop needing the U.S. dollar. That’s how and why the dollar is getting set for a fall.

I don’t think this trend has been reported much, in U.S. media. I try to spread the word, as I can. The U.S. has worsened its own problems in the last six years, and is moving toward some tough times. Get ready. Have your life in order: health & relationships fixed, debts paid, career solid. Also, don’t hide under a rock, but just in case things get really bad, consider maybe having some emergency supplies, gold and/or guns.

Don’t say you weren’t warned. Russia, China and India have problems too, but some (not all) of those problems stem from U.S. dominance and will be solved as they slowly re-organize the world in their favor.

Filed Under: Debt Crisis, Depression 2.0, Economy Tagged With: china, Debt Crisis, depression 2.0, Economy, germany, u.s. dollar

Categories

Archives