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Thread: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dollar

  1. #121
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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    China and Russia have decided to renounce the US dollar and resort to using their own currencies...

    Chinese experts said the move reflected closer relations between Beijing and Moscow...

    "China will firmly follow the path of development and support the renaissance of Russia as a great power," he said.

    "The modernization of China..., and strong Sino-Russian relationship is in line with the fundamental interests of both countries."

    The Axis economic warfare is no longer secret while outsourcing our technology and trade deficits won't change until its too late.

    Its just a matter of time.

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    Nikita Khrushchev: "We will bury you"
    "Your grandchildren will live under communism."
    “You Americans are so gullible.
    No, you won’t accept
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    outright, but we’ll keep feeding you small doses of
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    until you’ll finally wake up and find you already have communism.

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    We’ll so weaken your
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    like overripe fruit into our hands."



  2. #122
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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    China, Russia Quit Dollar

    Fire it up 21
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    St. Petersburg, Russia -
    China and Russia have decided to renounce the US dollar and resort to using their own currencies for bilateral trade, Premier Wen Jiabao and his Russian counterpart Vladimir Putin announced late on Tuesday.

    "About trade settlement, we have decided to use our own currencies," Putin said at a joint news conference with Wen in St. Petersburg.

    The two countries were accustomed to using other currencies, especially the dollar, for bilateral trade. Since the financial crisis, however, high-ranking officials on both sides began to explore other possibilities.

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    Nikita Khrushchev: "We will bury you"
    "Your grandchildren will live under communism."
    “You Americans are so gullible.
    No, you won’t accept
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    outright, but we’ll keep feeding you small doses of
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    until you’ll finally wake up and find you already have communism.

    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    ."
    We’ll so weaken your
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    until you’ll
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    like overripe fruit into our hands."



  3. #123
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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    i'll be honest. if i were some other country and didn't like america printing too much money (devaluing the worth of the us dollars i have), i'd ditch the us dollar too. the tactic is sound and is VERY capitalistic approach to doing business. however, this does not do any good to the us economy. ron paul (and MANY MANY others) is right (regardless how many people lump him in with alex jones): our foreign policy over the past 40 years screwed us over. the moment other countries can rely on themselves without the use of american dollars, any of those countries whom we've bullied around are going to stick it up our asses. i still think the basic principals of america are very sound and lead to a healthy society. but if capitalistic power and greed cannot be contained in a sense that perpetuates "the republic" AND the rest of the world, the rest of the world will make it difficult for the republic (which it has). either way, i will defend what america "used to stand for".

  4. #124
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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    Putin signals Russia may adopt single currency with Europe in future

    11-27-2010 09:35 BJT

    Text:A A A |Email Share |



    BERLIN, Nov. 26 (Xinhua) -- Russian Prime Minister Vladimir Putin said on Friday he was confident for the euro and Russia and Europe may join single currency someday in the future during his visit to Germany.

    The euro has shown its quality as a "stable world currency" even some eurozone countries are suffering debt crisis. Putin said at a forum of business leaders in Berlin.

    He praised the measures taken by the European Central Bank to keep the stability of the currency and he was confident that the sovereign debt crisis will be overcome in the end.

    Putin emphasized the importance of strengthening the cooperation between Russia and the European Union (EU), saying "a rapprochement between Russia and Europe is inevitable, if we want to be successful and competitive."

    "Can we assume that Russia together with Europe will one day be in a single currency zone? I can assume that," he said.

    Putin also criticized the dominance of U.S. dollar in the world economy, which makes it vulnerable.

    In a later joint press conference with German Chancellor Angela Merkel, Putin reiterated his will to strengthen cooperation with the EU, saying closer economic cooperation is the first step toward a monetary union.

    Merkel also said closer economic ties are the first steps and will be helpful for later adjustments on currency policies in the future.

    Before the meeting with Merkel, local newspaper Sueddeutsche Zeitung said on Thursday that Putin called for establishing a free trade zone with the EU, which was doubted by Merkel, saying "I have to pour a bit of cold water on it" as "the recent steps taken by Russia are not in the same direction" on that day.

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    Nikita Khrushchev: "We will bury you"
    "Your grandchildren will live under communism."
    “You Americans are so gullible.
    No, you won’t accept
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    outright, but we’ll keep feeding you small doses of
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    until you’ll finally wake up and find you already have communism.

    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    ."
    We’ll so weaken your
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    until you’ll
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    like overripe fruit into our hands."



  5. #125
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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    UAE seeks unified currency for GCC

    Sunday, December 05, 2010 3:33:27 PM by IANS ( Leave a comment )

    Abu Dhabi, Dec 6 (IANS) The UAE is still looking forward to a unified currency for the six-nation Gulf Cooperation Council, Economy Minister Sultan al-Mansouri said.

    The UAE, the second-largest Arab economy and the world’s third largest oil exporter, opted out last year of the GCC plans for monetary union, becoming the second country in the six-nation body to withdraw from the drive.

    Oman was the first to drop out of the project, saying its economy is not ready yet.

    However, Mansouri Sunday gave a glimpse of hope that the UAE could be back on the track of the monetary union talks, reports Xinhua.

    “I look forward that one day there would be a unified currency for the people of the Gulf,” Mansouri said in an interview with Saudi Arabia’s Aleqtisadiah newspaper.

    The minister’s statements came on the eve of the annual summit of the GCC leaders in Abu Dhabi.

    “I think such issues must be raised and discussed at such summit, and there must be an evaluation of the dimension of the issue and how to reach a compromise for all sides,” the minister told the paper.

    In May 2009, the UAE withdrew from the plans in protest of a decision to place the GCC central bank in Saudi Arabia, which the UAE had bid to host from 2004 to 2009.

    “Here in the UAE, we believe that the Gulf states share the same destiny, whether economically, politically, or socially. We are one people,” he said.

    Founded in 1981, the GCC groups Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE.

    The six states together hold around 45 percent of the global oil reserves and produce 16 million barrels of crude oil daily.

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    Nikita Khrushchev: "We will bury you"
    "Your grandchildren will live under communism."
    “You Americans are so gullible.
    No, you won’t accept
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    outright, but we’ll keep feeding you small doses of
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    until you’ll finally wake up and find you already have communism.

    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    ."
    We’ll so weaken your
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    until you’ll
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    like overripe fruit into our hands."



  6. #126
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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol


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    Nikita Khrushchev: "We will bury you"
    "Your grandchildren will live under communism."
    “You Americans are so gullible.
    No, you won’t accept
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    outright, but we’ll keep feeding you small doses of
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    until you’ll finally wake up and find you already have communism.

    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    ."
    We’ll so weaken your
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    until you’ll
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    like overripe fruit into our hands."



  7. #127
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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    Why Are The Chinese Gobbling Up Gold Like There Is No Tomorrow?



    Why are the Chinese buying so much gold? In 2010 it has been demand out of China that has been one of the primary factors for the dramatic rise in the price of gold. Gold is up approximately 26 percent this year, and most analysts expect it to go even higher in 2011. So is China buying gold at a breathtaking pace because they view it as a good investment, or are there other factors at work here? Do the Chinese view gold as a hedge against inflation? Is China seeking to get out of U.S. Treasuries? Has gold simply become much more attractive than paper currencies such as the euro and the U.S. dollar? Or could China be preparing for the coming financial collapse that so many economists see coming? It is always difficult to tell exactly what China is up to, but one thing is for sure - they are buying gold like there is no tomorrow.

    It recently was announced that China imported 209.7 metric tons of gold during the first ten months of 2010. That was five times more gold than China imported during the first ten months of 2009.

    So what can account for such a dramatic increase?

    Does China need all of that gold for domestic use?

    Without a doubt gold is becoming much more popular in China, but it is not as if China does not produce a massive amount of gold on their own. In fact, since 2007 China has been the number one producer of gold in the entire world. They are certainly not suffering from a shortage of gold.

    If that is the case, then what else could explain why China is buying gold so rapidly?

    Well, there seem to be four primary theories for why China is buying up so much gold right now.

    #1 A Hedge Against Inflation
    Already we are starting to see some very serious inflation in China. In particular, food inflation threatens to spiral out of control. In an inflationary environment, gold is always a good investment.

    #2 An Alternative To U.S. Treasuries

    Over the past decade, China has invested very, very heavily in U.S. Treasuries. In fact, the U.S. government owes China nearly a trillion dollars at this point. However, over the last year or two China has dramatically slowed down their purchases of U.S. Treasuries and they have been actively seeking out alternative investments. Gold has always been a very safe investment, and with the world financial system so unstable right now it makes a lot of sense to invest in gold.

    #3 A Lack Of Faith In Paper Currencies

    Over the past decade, China has accumulated a gigantic pile of foreign exchange reserves, but lately paper currencies such as the euro and the U.S. dollar have become increasingly unstable. The European sovereign debt crisis threatens to collapse the euro at any moment. Quantitative easing 2 and the tax cut deal that Barack Obama and the Republicans are trying to push through Congress are causing the rest of the globe to lose a tremendous amount of faith in the U.S. dollar. In this type of environment, holding paper currencies has become much less attractive.

    #4 Preparing For The Coming Financial Collapse

    It doesn't take a genius to figure out that we are living in the greatest debt bubble in the history of the world and that at some point the world financial system is going to crash. When that happens, the safest place to be will be in precious metals and other commodities. The Chinese have been busy gobbling up gold, silver and many other commodities, and so whether they mean to or not, they are positioning themselves to weather the coming financial storm better than most other nations.
    Once again, it is always hard to tell exactly what China is doing. Perhaps in six months or a year China will change course again. But right now China is gobbling up huge amounts of gold, and if this continues it is going to create a huge imbalance in global financial markets.
    In fact, if all of this Chinese gold buying goes on long enough, it could blow out many of those who are holding significant short positions in gold.

    But it is not just the Chinese government that has caught "gold fever" these days.

    Chinese citizens are buying gold at a rate that has never been seen before.

    On the Shanghai Gold Exchange, trading volume soared 43 percent during the first 10 months of 2010.

    As the Chinese middle class has grown, gold has become much more popular. Amazingly, Chinese households have purchased almost half as much gold since mid-2007 as all the investors in the West combined.

    This is yet another sign of how far China has come. China is not a minor
    player on the world stage any longer. The truth is that China is now a major economic superpower.

    In a previous article entitled "China #1, United States #2? 25 Facts That Prove The Transition Is Really Happening", I detailed some of the statistics that prove that China has become an absolute powerhouse.

    The following are just a few examples of those statistics....

    *The United States had been the leading consumer of energy on the globe for about 100 years, but this past summer China took over the number one spot.

    *Over the past 15 years, China has moved from 14th place all the way up to 2nd place in the world in published scientific research articles.

    *According to one recent study, China could become the global leader in patent filings by next year.

    *China now possesses the fastest supercomputer on the entire globe.

    *China now has the world's fastest train and the world's largest high-speed rail network.

    *Back in 1998, the United States had 25 percent of the world’s high-tech export market and China had just 10 percent. Ten years later, the United States had less than 15 percent and China's share had soared to 20 percent.

    *Nobel economist Robert W. Fogel of the University of Chicago is projecting that the Chinese economy will be three times larger than the U.S. economy by the year 2040 if current trends continue.

    So what about the United States?

    Well, the truth is that Americans have become so dumbed-down that only about 70 percent of them can even find China on a map.

    How sad is that?

    On the global chessboard, China seems to constantly be four or five moves ahead of the United States these days.

    So if China is busy buying gold at a feverish pace perhaps it is because they know exactly what they are doing.

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    Nikita Khrushchev: "We will bury you"
    "Your grandchildren will live under communism."
    “You Americans are so gullible.
    No, you won’t accept
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    outright, but we’ll keep feeding you small doses of
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    until you’ll finally wake up and find you already have communism.

    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    ."
    We’ll so weaken your
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    until you’ll
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    like overripe fruit into our hands."



  8. #128
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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    World Bank Taps Offshore Yuan Bond Market For First Time
    January 5, 2011

    The World Bank issued its first yuan-denominated bond, raising $76 million and trying to promote the use of the Chinese currency in international markets at a time when China's stake in the institution is about to increase.

    The World Bank said in a statement on Wednesday the International Bank for Reconstruction and Development, its low-interest lending arm, had priced the two-year paper at 0.95 percent, representing the lowest yield so far on same-maturity dim sum bonds -- the nickname for yuan-denominated bonds issued in Hong Kong.

    The offshore yuan market in Hong Kong has seen explosive growth in less than a year, with renminbi deposits in the former British colony surging more than 150 percent in the six months to October 2010. Global companies and institutions such as the Asian Development Bank, McDonald's Corp and Caterpillar have all issued yuan bonds.

    The World Bank's 500 million yuan bond issue arrived when China's shareholding in the World Bank is about to increase, potentially making China the third-largest stakeholder in the lender after the United States and Japan.

    "This is a landmark transaction for the World Bank as it is the first World Bank issuance in RMB, and signals the strong interest of the World Bank in supporting the development of the RMB market," Doris Herrera-Pol, Global Head of Capital Markets at the World Bank, said in a statement.

    "It is a privilege for us to have this opportunity that establishes the institution as a premier issuer in the fastest growing capital market in the world."

    HSBC was the lead manager for the deal, which will settle on Jan. 14.

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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    Sarkozy urges less international reliance on US dollar



    Großansicht des Bildes mit der Bildunterschrift: Sarkozy's ideas about toppling the dollar will likely find little US support


    French President Nicolas Sarkozy visited his US counterpart Barack Obama on Monday. The world economy was high on the agenda - including Sarkozy's aim of reducing the influence of the US dollar.

    France is hosting this year's G8 and G20 summits, and French President Nicolas Sarkozy has started to campaign for a change to the way the US dollar plays a central role in the global economy.

    In his New Year's Eve address to his country, Sarkozy said France would look to change a system which no longer reflects our modern global society.

    "The system put in place in 1945 is for a world that doesn't exist anymore," the French president told the nation.

    He suggested that the current model which uses the US dollar as the primary reserve currency was "unstable" and "makes part of the world dependent on American monetary policy."


    Bildunterschrift: Großansicht des Bildes mit der Bildunterschrift: If the dollar drops, it has a global effect


    Sarkozy's plan is to update everything to what he regards as the new reality of a more multi-polar world and the rise of new powers like India, Brazil and China.

    'Dangerous' to rely on dollar
    Sarkozy is not the only Frenchman who wants to reduce the world's reliance on the dollar. Philippe Dessertine from Paris' High Finance Institute recently described using the dollar as the only reserve currency as "very dangerous."

    Recent actions by the US Federal Reserve to stimulate the economy through quantative easing – where dollars are printed to buy US government bonds in order to increase the money supply – have been criticized internationally.

    "The Federal Reserve's latest actions favor the US but have consequences for the rest of the world," Dessertine said. "Emerging countries and Europe really want to change that."

    Devalued dollars flood developing countries, which push their currencies up, quashing their exports and potential for job creation.

    Dollar is king… for now
    Dessertine and other economists say the dollar will remain king for now, so long as the world economy does not go into recession. But if things get worse, the US will have to work with other nations to reduce the dollar's influence.


    Bildunterschrift: Großansicht des Bildes mit der Bildunterschrift: As hosts of this year's G8 and G20, France hopes to have influence


    Other options would be to have several reserve currencies, or a basket of currencies to act as reserves.

    The hardest part of Sarkozy's plan is convincing the US to give up the dollar's dominant position.

    "With respect to international financial regulation, trying to stabilize currency rates and commodity prices… These are not going to be areas where the United States, and indeed Obama, are most receptive," said Nicholas Dungan, a US-based advisor with the French Institute of International and Strategic Relations.

    So far Sarkozy has secured the backing of the leaders of India and China.

    He will now be hoping he will succeed at least in getting world leaders to talk about a new monetary system at this year's global summits in France. He will be hoping President Obama will also be prepared to join in these discussions.

    Author: Eleanor Beardsley (cb)
    Editor: Ben Knight

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    Nikita Khrushchev: "We will bury you"
    "Your grandchildren will live under communism."
    “You Americans are so gullible.
    No, you won’t accept
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    outright, but we’ll keep feeding you small doses of
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    until you’ll finally wake up and find you already have communism.

    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    ."
    We’ll so weaken your
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    until you’ll
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    like overripe fruit into our hands."



  10. #130
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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    Bank of China Opens for Renminbi Trade in U.S.


    Alexander F. Yuan/Associated Press A Bank of China branch in Beijing.


    Call it liberalization by a thousand cuts.

    The Bank of China, one of the country’s main state-owned lenders, is now allowing American firms to trade in renminbi, another step in China’s effort to position the the renminbi on the world stage.

    In July, China started a renminbi settlement system for cross-border trade in Hong Kong, but it placed limits on how much currency could be exchanged.

    Currency trading in the renminbi was already possible at other banks, but the move by a state-owned lender signals a shift in official policy.

    The Chinese central bank bowed to international pressure last summer and agreed to make its currency more flexible; the renminbi is now allowed to move as much as 0.5 percent each day. At the same time, the country is cautiously pursuing a strategy of making the renminbi into an international exchange currency.

    “China sees the global financial system as too U.S.-centric and dollar dependent,”’ said Robert Minikin, senior currency strategist at Standard Chartered in Hong Kong. “That created issues during the financial crisis.”

    Now, he said, the country is trying to take a step away from that dependence. “Conditions are in place for sustained yuan appreciation against the U.S. dollar,’’ he said, predicting that it would increase by 6 percent this year, to 6.20 renminbi per dollar.

    With a forecast for high inflation in the expanding Chinese economy, an appreciating currency could help the country dampen so-called imported inflation by making foreign goods less expensive.

    With the Bank of China move, China is promoting the renminbi to Americans at a time when loose monetary policy on the part of the United States Federal Reserve has some concerned that the dollar’s value will continue to decline.

    The Bank of China said in an announcement on the Web site of its New York branch that trading firms and individuals could now open accounts in renminbi, buying the currency from and selling it to the bank.

    While the limits on personal accounts are $4,000 a day and $20,000 a year worth of renminbi, and those accounts are largely for the purposes of exchange and remittance, the bank is also soliciting business from trading firms.

    China’s decision to keep the renminbi effectively pegged against the dollar at an exchange rate that favors its exports has long been a source of contention between Washington and Beijing. China’s trade surplus with the United States was $181 billion last year, a 26 percent increase from the previous year, The imbalance is likely to put further pressure on the exchange rate.

    That said, the renminbi hit a new high of 6.6128 against the dollar on Wednesday, an auspicious prelude to a visit to Washington next week by China’s president, Hu Jintao.

    Separately, the city of Shanghai said it was creating a new investment window, allowing qualified private equity firms to buy renminbi and invest in mainland companies. Reuters reported that the pilot project could grow to be worth $3 billion.

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    Nikita Khrushchev: "We will bury you"
    "Your grandchildren will live under communism."
    “You Americans are so gullible.
    No, you won’t accept
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    outright, but we’ll keep feeding you small doses of
    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    until you’ll finally wake up and find you already have communism.

    To view links or images in signatures your post count must be 15 or greater. You currently have 0 posts.
    ."
    We’ll so weaken your
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    until you’ll
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    like overripe fruit into our hands."



  11. #131
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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    Chinese Yuan; A new world reserve currency?

    Only a mere twelve days into the New Year (2011) and China have already set the wheels in motion to use their most powerful weapon, the Yuan, in order to combat inflation.

    This may well be the first decision of many that will result in the Yuan being phased in as the new world reserve currency.

    A stronger exchange rate will be the tool that China use in order to tame their inflationary problems at present. The biggest increases being felt as a result of inflation at this time are; the Chinese housing market, which was most dramatically affected in the southern industrial hub of Guangzhou, where home prices soared by 38 percent in the past year.

    Another sector heavily affected was Chinese groceries, with the cost of some foods increasing by 50 percent.

    In an attempt to address the loose lending policies being adopted by Chinese banks, Chinas government have ordered their banks to increase the amount of money that each bank holds in reserves with a reduction in the availability of lending.

    The strengthening Yuan will essentially result in two ways; 1, their imports will become substantially cheaper. 2, their exports will be more expensive.

    This is a move that the US have not wanted the Chinese to take as most of the consumer goods that are stocking up US stores are Chinese-made products and the longer the Chinese allowed their currency to be held at a relatively low level (compared to its purchasing power potential) the longer the shopaholics’ in America could continue to buy their products at a price that they could afford (or a level that they could get credit for)

    So, with the world outside China continually devaluing their currencies and China increasing theirs who is going to pick up the export market? And how do they intend to do this?

    Before hand, the countries that were importing goods from China were benefiting from a manipulated Yuan price which gave the illusion of cheap imports. But now, that is not an option. The only way that I can see that will enable countries to bridge the export gap will be, further devaluation of their paper currency, which as any respecting economist knows is only an extremely short-term solution (if it can even be called that) and will only result in long-term high inflation for that economy.

    This currency policy decision by the Chinese government will help to add to the increasing confidence in the Yuan as a world reserve currency contender to replace the failure that is, the US Dollar.

    Aside from the measures taken to combat inflation in China, there have been many other recent events that all point to the strengthening of the Yuan and the growing popularity of the currency.

    In the last week, the World Bank issued their very first Yuan bonds; they will release the amount of 500 million Yuan, which is around $70 million in US Dollars. The bank has said that, these actions are an act of confidence in the Renminbi and will give investors around the globe the opportunity to diversify and help the exposure of the Yuan in global markets. The bonds will be offered from January 14th, 2010 and will mature after two years in 2013.

    In July of last year (2010) China began allowing cross-border exchange with the renminbi, however, there were caps on exactly how much currency was allowed to be exchanged. That was the closest China had come to allowing the renminbi to be a top currency on a global scale, until now.

    Today marks the beginning of the renminbi being allowed to be traded in the U.S, China have identified that the global economy has become too reliant on the Dollar and wants to provide an opportunity to move away from that.

    China have already implemented strategies that will allow for sustained appreciation for the Yuan against the US Dollar, a prediction in the rate of appreciation was projected at 6% in 2011 by Robert Minikin, who is a currency strategist at Standard Chartered based in Hong Kong.

    The reason that there hasn’t been a replacement of the US Dollar as the world reserve currency as of yet is the fact that there was no currency that was ready to take on that mantle, however, given the performance of the Yuan in the last two years, it has shown its power and reliance as a solid currency, not only that, but China have also helped their cause by not relying on a paper, fiat currency but actually using the strengthening Yuan in which to buy up gold and other major assets, something that every single country in the so-called ‘advanced’ world has not done.

    All of these factors are now helping to shape the Yuan into tomorrow’s new world reserve currency and once this transformation occurs, it really will spell the end for the down but not yet out, Dollar.

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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    16 January 2011 - 21H53
    Hu calls currency system 'product of the past'



    A Chinese bank clerk uses a machine to count stacks of one-hundred yuan notes. China's President Hu Jintao said Sunday the international currency system was "a product of the past," but it would be a long time before the yuan is accepted as an international currency.

    AFP - China's President Hu Jintao said Sunday the international currency system was "a product of the past," but it would be a long time before the yuan is accepted as an international currency.

    Hu's comments, which came ahead of a state visit to Washington on Wednesday, reflected the continuing tensions over the dollar's role as the major reserve currency in the aftermath of the US financial crisis in 2008.

    "The current international currency system is the product of the past," Hu said in written answers to questions posed by The Wall Street Journal and the Washington Post.

    Highlighting the dollar's importance to global trade, Hu implicitly criticized the Federal Reserve's recent decision to pump 600 billion dollars into the US economy, a move criticized as weakening the dollar at the expense of other countries' exports.

    "The monetary policy of the United States has a major impact on global liquidity and capital flows and therefore, the liquidity of the US dollar should be kept at a reasonable and stable level," Hu said.

    China's own currency, the yuan or renminbi (RMB), is also expected to be a bone of contention in Hu's talks with Obama, with the United States complaining that it is artificially overvalued to boost Chinese exports.

    Asked about the view that appreciation of the yuan would curb inflation in China, Hu suggested that was too simplistic a formula.

    "Changes in exchange rate are a result of multiple factors, including the balance of international payment and market supply and demand," he said.

    "In this sense, inflation can hardly be the main factor in determining the exchange rate policy," he said.

    At the same time, Hu signalled no imminent move away from the dollar as a reserve currency, saying it would be a long time before the yuan, or renminbi (RMB), is widely accepted as an international currency.

    "China has made important contribution to the world economy in terms of total economic output and trade, and the RMB has played a role in the world economic development," he said.

    "But making the RMB an international currency will be a fairly long process."

    Nevertheless, Hu noted that China has launched pilot programs using the yuan, or renminbi, in settlements of international trade and investment transactions.

    "They fit in well with market demand as evidenced by the rapidly expanding scale of these transactions," he said.

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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    World Bank issues first yuan-denominated bond

    January 5, 2011

    The World Bank has issued its first yuan-denominated bond in a move that will help China as it tries to increase the use of its currency in global markets.

    The Washington-based lender said Tuesday it would raise 500 million yuan (76 million US dollars) from the two-year bond issue on Hong Kong's yuan-denominated bond market.

    The move will "further deepen the market and permit investors to diversify their currency holdings and expand renminbi exposure", the World Bank said in a statement, using the official name for the Chinese unit.

    Last month, China said its second yuan-denominated bond issue in Hong Kong had initially raised five billion yuan, with plans for another three billion yuan to be sold.

    The move followed Beijing's first yuan-denominated bond issue in Hong Kong in September last year, worth about six billion yuan.

    It also comes after heavy equipment maker Caterpillar and fast-food giant McDonald's each issued yuan-denominated bonds in Hong Kong, the first such sales by non-financial foreign firms in the city.

    The semi-autonomous Chinese territory is acting as a test bed for the internationalisation of China's currency.

    Beijing is seeking to broaden the use of the yuan in the financial hub after approving its use to settle cross-border trade in 2009.

    Despite the global success of Chinese exporters, the yuan plays only a minor international role because it cannot be freely exchanged for other currencies. And official controls make it difficult to move the yuan in and out of China.

    Top leaders in Beijing want to see the yuan adopted as a global reserve currency to reflect China's growing economic and political clout.

    Allowing the yuan to be used more widely overseas also helps China reduce the amount of US dollars flowing into the country, which is adding to its already world-beating foreign exchange stockpile and fanning inflation.

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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    The End of the Dollar

    From the March 2011 Trumpet Print Edition »

    In January, Chinese President Hu Jintao was wined and dined with a lavish state banquet at the White House and other official ceremonies usually reserved for America’s closest friends and allies. Why? One must be very polite when entertaining your banker—even if you don’t like him and he doesn’t like you.

    Yet there is another more ominous but closely related reason.

    For years, China has warned America that its support for the dollar was not unconditional. The warnings fell on deaf ears. Confident that China was virtually forced to lend money to America, Washington embraced a borrow-and-spend policy that would have destroyed any other currency.

    Then last year, when it became clear that America could not borrow enough money to pay the bills—it crossed the Rubicon, declaring that the laws of paper money no longer applied to the mighty dollar: America would just print whatever money it needed to pay the bills. Federal Reserve Chairman Benjamin Bernanke declared he would start by conjuring $900 billion—75 percent of America’s borrowing needs—out of thin air.

    The world was shocked that America would so abuse the world’s reserve currency. France, Germany, Russia and China were outraged.

    But Americans wagered that the world is too caught in the dollar trap to do anything about it.

    So far, this strategy has worked out pretty well for America. With several European countries falling apart, the dollar has firmed up, and safe-haven money has continued to flow into America. But signs are, that is beginning to change.

    Europe’s Sugar Daddy
    As the Washington Post wrote, “[S]trange things are happening in Europe—none stranger than the emergence of China as the Continent’s sugar daddy” (January 16).

    Wait—wasn’t China America’s “sugar daddy”? Well, just follow the yen. In July 2009, China held $939 billion worth of U.S. treasury debt. More than a year later China’s holdings have fallen to $895 billion. This is big news—and surely isn’t lost on Washington. For more than a year, America’s most important creditor has stopped lending new money to America. Instead, China is investing its money, and its confidence, in Europe.

    Today, Europe matters more to China than any place in the world. With 400 million First World consumers and the world’s largest economy, the European Union is by far China’s biggest export market.

    It is a reciprocal relationship, too. China now directly holds over $900 billion worth of eurozone national debt. In Greece, China is investing billions more as it attempts to build the Mediterranean port city of Piraeus into the “Rotterdam of the south,” and create a modern-day silk road linking Chinese factories with consumers across Europe and North Africa.

    Most importantly, China has thrown its weight behind the euro.

    In a recent trip to Europe, Vice Premier Li Keqiang did nothing less than transform Europe’s economic picture. Just as commentators were predicting the collapse of the eurozone, Li—a favorite to become China’s next prime minister—appeared to throw China’s $2.85 trillion worth of foreign exchange reserves into Europe’s breach, promising to be a committed and responsible long-term investor in Europe. icbc bank, China’s largest lender, quickly followed suit, announcing its intention to move full force into the eurozone. It will open its first-ever branches in France, Spain, Italy, Belgium and the Netherlands. It has already opened offices in Frankfurt and Luxembourg.

    Li’s support is already paying dividends in Europe. With interest rates coming down from recent highs and successful debt auctions, Spain and Portugal got a welcome taste of what several billion euros’ worth of Chinese “sugar” can do.

    Of course, it doesn’t come free. Li publicized China’s desire that the EU relax restrictions on high-tech exports to China and develop trade relations. In addition, China wants access to Europe’s defense companies.

    Europe seems all too willing to do business. The EU’s Foreign Minister Catherine Ashton called for abolishing Europe’s arms embargo with China. Reportedly, American officials, who have to deal with a rapidly growing Chinese military presence in the Pacific, are furious.

    What Will Replace the Dollar?
    It was what Hu Jintao told the Wall Street Journal just prior to his arrival in Washington, however, that should have all Americans preparing for one massive sugar crash. He said the dollar should no longer be the world’s reserve currency. It is a “product of the past,” he said. It is time for a more fair and balanced system.

    What does China think should replace the dollar? Hu himself said it wouldn’t be the yuan. What does that leave? Follow the sugar.
    “The euro will overcome the region’s deficit crisis,” assured Song Zhe, China’s ambassador to Europe, back in December. The cementing of the euro’s status will “promote the building of a diversified global currency system,” he said.

    Remember: When anyone talks about “diversifying” the global currency system, by definition it means ditching the current system—which is the dollar.

    And China isn’t alone in shifting support to the eurozone. Japan has also announced that it will step up its efforts to back Europe by purchasing eurozone debt. According to Reuters, Japan will purchase 20 percent of soon-to-be-issued Eurobonds. The Eurobonds would be jointly issued and backed by all members of the eurozone—creating a new debt market that will directly compete with U.S. treasuries. Where will Japan get the money? As America’s second most important lender, it has a whole stack of treasuries it would probably love to “diversify” out of.

    If the world wants out of the U.S. dollar, there is only one viable paper alternative: Europe.

    According to Li Daokui, an academic member of the Chinese central bank’s monetary policy committee, Americans only have months to prepare—while Europe works to get its act together. “For now, market attention is still on Europe and for the coming 6 to 12 months, it will not shift to the United States,” said Li on December 8. “But we should be clear in our minds that the fiscal situation in the United States is much worse than in Europe.

    In one or two years, when the European debt situation stabilizes, attention of financial markets will definitely shift to the United States. At that time, U.S. treasury bonds and the dollar will experience considerable declines.”

    Strange things are happening in Europe. Now you know why. The international monetary system set up at Bretton Woods in 1944 is on the verge of breaking down, and the dollar will soon be fighting for its survival as the world’s reserve currency.

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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    In China, Tentative Steps Toward Global Currency


    Published: Thursday, 10 Feb 2011 | 9:18 PM ET

    By: David Barboza

    Now that it has passed Japan to become the world’s second-largest economy after the United States, China is considering the next step as a world power: making its money a global currency.
    Eugene Hoshiko / AP


    No one expects that to happen immediately. And even the Chinese government is wary of making some of the free-market moves that would enable the renminbi [CNY=X 6.5905 -0.0012 (-0.02%) ] to take its place alongside the dollar, euro and Japanese yen as a fully convertible reserve currency.

    Still, over the last year Beijing has begun to gradually loosen its tight currency controls. For the first time, for example, American companies like McDonald’s [MCD 76.14 0.38 (+0.5%) ] and Caterpillar [CAT 103.54 2.94 (+2.92%) ] have been allowed to finance their China projects by selling renminbi-denominated bonds in Hong Kong.

    Richard Lavin, a group president at Caterpillar, said his company’s $150 million Hong Kong offering last November was less expensive than taking out a loan in China or raising the money in dollars and then converting those dollars into renminbi. The bonds were issued to help finance Caterpillar’s equipment leasing business in China.

    “This was a successful issue,” Mr. Lavin said. “Before, we were funding our operations by bringing in dollars and changing them to RMB.”

    Meanwhile, in Russia, Vietnam and Thailand, some cross-border trades with China can now be settled in renminbi, so that trading partners do not have to convert in and out of dollars. One pilot program lets Russian companies like Sportmaster, a retail chain based in Moscow, buy or sell goods using Chinese currency.

    And in New York, the Chinese government has permitted an overseas branch of Bank of China to accept deposits in renminbi. That enables depositors outside China to bet on a currency that is widely expected to appreciate against the dollar over the next few years.

    “This is all encouraging the internationalization of the renminbi,” Kelvin Lau, an economist at Standard Chartered Bank who is based in Hong Kong, said of Beijing’s recent moves. “They want to make the Chinese currency a popular currency.”

    At Thursday’s exchange rates, renminbi were trading just below 6.59 to the United States dollar — a level that many experts say values the Chinese currency artificially low, as a result of Beijing’s intervention efforts. Five years ago, the renmimbi was trading at slightly more than 8 to the dollar — more than 20 percent higher than now.

    Beyond mere bragging rights, China has economic motives for trying to go global with the renminbi. Analysts say the moves, if successful, could strengthen China’s influence in overseas financial markets and begin to erode the dollar’s dominance. Beijing could also eventually reap the rewards, like cheaper debt financing, that come with being recognized as a world reserve currency.

    Global investors eager to bet on China’s growth story, meanwhile, could find that looser controls on the renminbi make it easier to invest directly in bonds and other assets denominated in renminbi.

    And importers and exporters could reduce their currency-fluctuation risks by settling China-related trade deals in renminbi rather than dollars or euros.

    Robert A. Mundell, a Nobel laureate economist whose research is credited with helping develop the euro, says the renminbi’s rise is all but inevitable.

    “The RMB is likely to become a reserve currency in the future, even if the government of China does nothing about it,” Professor Mundell said in an e-mail response to questions. He noted that the renminbi was already a regional currency in Southeast Asia, where China had become the dominant trading partner of many countries.

    If China does eventually open its capital market by eliminating currency exchange controls, he said, “the progress of the RMB as an international currency will be assured.”

    But analysts caution that right now the renminbi is far from ready to mount a serious challenge to the United States dollar as the world’s leading reserve currency. For one thing, China needs to assure investors that its political system is stable and that its economy still has plenty of growth ahead. For all its rapid growth over the last 30 years, China remains relatively poor compared with the United States, the Europe Union or Japan.

    As an influence on global financial markets, the renminbi is “still a distant, distant, distant fourth,” said Albert Keidel, a China specialist at the Public Policy Institute at Georgetown University in Washington. “People are going to start holding more renminbi, but it will be at least a decade or two for it to become a leading world reserve currency.”

    China is the world’s largest exporter and one of the biggest destinations for foreign direct investment, but the Chinese government still maintains strict control over its currency and banking system and the flow of money in and out of the country.

    Economists say these restrictions allow Beijing to manage — some say manipulate — the renminbi exchange rate, keeping the currency undervalued enough to bolster exports. The policies also restrict the amount of capital that can enter the country — or exit in the event of a sudden downturn.

    China has been reluctant to make its currency fully convertible because its banks and financial system are still immature. What is more, allowing money to flow in and out of the country with few restrictions would effectively mean surrendering control over vital aspects of the state-run banking system.

    But analysts say Beijing may eventually be forced to change its approach because its self-imposed financial restrictions leave the door to international markets only half open for China, undermining its global ambitions.

    China’s tight management of exchange rates also leads to complex market distortions that analysts say force Beijing to accumulate huge foreign exchange reserves — much of them in the form of American Treasury bonds. As long as China continues tightly linking the renminbi to the dollar, analysts say, the People’s Bank of China is effectively outsourcing the nation’s monetary policy to the United States Federal Reserve. And as the value of the dollar has dropped in recent years, Beijing has begun complaining that the United States’ soaring budget deficits are eroding the value of China’s huge dollar-denominated holdings.

    Eswar S. Prasad, a professor of economics at Cornell University and the former head of the International Monetary Fund’s China division, says these concerns are pushing China to step up its own efforts to reduce its reliance on the dollar and internationalize its own currency.

    “This is a striking change,” Professor Prasad said. “But this is all conditional on whether they can reform their own financial markets. They know that if they open and their financial markets are not ready, it could lead to a disaster.”

    If Beijing is not willing to take the steps necessary for making the renminbi fully convertible, many analysts doubt whether China can internationalize its currency in the coming years.

    “They’re in uncharted territory,” says Nicholas R. Lardy, an economist and China specialist at the Peterson Institute for International Economics in Washington. “But this is how China does everything. They experiment around the edges. You might look back 10 years from now and say it was the opening wedge in a transformation. Or it could be a flop.”

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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    Rounding off the digits, I read that @70 billion are traded on stocks each day, while 70 trillion are traded in currency markets. hmmmm. ?

    Why dont the big $$ folk invest in productive projects such as eolic energy, agro-industry in latin America, and factories - US & latin America at decent wages?

    canto XXV Dante

    from purgatory, the lustful... "open your breast to the truth which follows and know that as soon as the articulations in the brain are perfected in the embryo, the first Mover turns to it, happy...."
    Shema Israel

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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    Communist China Embraces the Gold Standard

    Daniel Sayani | The New American
    22 February 2011

    In one of the most ironic and revealing moves in the unfolding of relations between the United States and China, China has announced that it is seeking a shift to the gold standard. According to the World Gold Council, the market development organization for the gold industry, China’s appetite for gold has been rapidly expanding: It consumed 175.2 tons of gold in the fourth quarter of 2010, bringing its grand total for the year to 579.5 tons, or 18.5 million ounces. By comparison, the United States consumed a mere 233.3 tons of gold in 2010. While it is unknown how much of China’s gold acquisitions were made by private citizens, industry, or central banks, speculations remain as to what the country's true intentions are regarding its continued massive purchase and use of the gold. The financial news source The Street reports that many in the gold community theorize that China wants its yuan to become the world's reserve currency, and is buying gold and silver in order to accomplish that goal:A Chinese gold standard?

    The idea is staggering and not to mention fraught with difficulties. China's central bank currently holds 1,054 tons of gold, about 1.8% of its total reserves.

    China currently holds $2.85 trillion in foreign reserves. This means the country would need to buy roughly 66,000 tons of gold to fully back its currency. Even if the country upped the ante to just 3%, the country would need to buy 1,000 tons.

    China has also been telling its citizens to buy gold, promoting different gold funds, giving investors access to overseas products and launching a global gold contract based in yuan by Chinese Gold & Silver Exchange. The ICBC and World Gold Council recently teamed up for the creation of the Only Gold Gift Bar in China, where a customer can buy gold as a gift complete with engraving and can sell it back to the ICBC for cash.

    China’s gambit for global dominance, therefore, rests upon the notion that it must impose economic policies that will boost its power, prosperity, and economic strength. While staying true to the theoretical foundations and assumptions of the communist state, including its commitment to the principles of Marxism-Leninism and Maoism, China realizes that in order for the communist state to be strengthened and prevail victorious, it must incorporate some classical principles and economic concepts associated with capitalism.

    Karl Marx believed that all states progressed through a series of several economic stages, culminating in a communist state. Observing economic history in his native Germany, Marx believed that states proceeded from capitalism to socialism, and then culminated in outright communism. Since China never before had a Western-style communist economy, it is now embracing capitalism — not in its true laissez-faire, free-market form, but within the context of centrally-planned state capitalism. After the death of Mao Zedong in 1976, under Deng Jiaoping China began embracing elements of state capitalism, and in 2002, its pantheon of communist theory expanded to include Jiang Zemin’s Theory of Three Represents, which includes an emphasis on economic production, and “represents advanced social productive forces.”

    China’s turn toward hard currency in the form of the gold standard is the latest development in its pursuit of wealth and power through state capitalism. This trend has rightly raised the concern of those who fear a dominant Red China, as reported in the Wall Street Journal:

    Central to China's approach are policies that champion state-owned firms and other so-called national champions, seek aggressively to obtain advanced technology, and manage its exchange rate to benefit exporters.

    It leverages state control of the financial system to channel low-cost capital to domestic industries — and to resource-rich foreign nations whose oil and minerals China needs to maintain rapid growth.

    China's policies are partly a product of its unique status: a developing country that is also a rising superpower. Its leaders don't assume the market is preeminent. Rather, they see state power as essential to maintaining stability and growth, and thereby ensuring continued Communist Party rule.

    It's a model with a track record of getting things done, especially at a time when public faith in the efficacy of markets and the competence of politicians is shaken in much of the West. Already the world's biggest exporter, China is on track to pass Japan this year as the second-biggest economy.

    Western critics say China's practices are a form of mercantilism aimed at piling up wealth by manipulating trade. They point to China's $2.6 trillion in foreign-exchange reserves. The U.S. and the European Union have lodged a series of WTO cases and other trade actions targeting Beijing's policies, and hammer China's refusal to let its currency appreciate more quickly, which they argue fuels global economic imbalances.

    Similar to China’s economic ascendancy is that of Russia, which has been described as embracing state capitalism as early as under the days of dictator Joseph Stalin’s rule, and to an even greater extent under the rule of its current leader, Vladimir Putin. Tony Cliff, in his book Russia: A Marxist Analysis, first identified Stalinism as a form of state capitalism in 1955, and most recently, Andrei Illarianov, Putin’s former economic adviser, defected from Russia to become a fellow at the Cato Institute, due to what he observed as state capitalism. Illarianov also cautioned that the West, especially the United States, is emboldening and enriching hostile regimes such as Russia and China, through continued investments and economic agreements:

    "This is the usual state of affairs of the West. As strange as it may seem, in actuality the West during the course of two centuries, and, perhaps, even longer, has supported any regimes at all. What is important for the West is its own short-term interests. And the West supports relations, including commercial ones, as we know, with Russian special services generals, and with Chinese communists, and with Iranian ayatollahs, and with Saddamist generals... In the 1930s, the West actively cooperated with Hitler's regime — the flow of French, American and British investments into Germany was huge."

    “…[s]o one simply needs to understand that that state of affairs which many of us remember from the period of the cold war, when partially certain western leaders — Reagan and Thatcher — took a moral political position in relation to the Soviet Union — such a phenomenon is historically still the exception, and not the rule. The west is extremely pragmatic and sufficiently lacking in principle in relation to external phenomena.”

    Russia has also moved toward adopting the gold standard, as previously reported by The Telegraph:

    Arkady Dvorkevich, the Kremlin's chief economic adviser, said Russia would favour the inclusion of gold bullion in the basket-weighting of a new world currency based on Special Drawing Rights issued by the International Monetary Fund.

    Chinese and Russian leaders both plan to open debate on an SDR-based reserve currency as an alternative to the US dollar at the G20 summit in London this week, although the world may not yet be ready for such a radical proposal.

    Mr Dvorkevich said it was "logical" that the new currency should include the rouble and the yuan, adding that "we could also think about more effective use of gold in this system."

    Like Russia, which is seeking to strengthen its currency in order to overtake what economist Joseph Liu called dollar hegemony, China has been manipulating its currency and trying to beef up the yuan to make it a more viable global currency. The website of the People's Bank of China says it is trying to allow banks and businesses in countries such as Russia and the U.S. to be able to make direct investments in the yuan, which essentially brings the once-isolated currency onto the world stage. The website explains that this move "better support[s] Chinese enterprises to go abroad and facilitate trades and investments."

    Even United States citizens realize the economic superiority of China over the beleaguered American economy, which consistently operates contrary to the capitalistic principles elevating China to wealth at America’s expense.

    While communist China moves in the direction of market reforms, decentralization, and privatization, including embracing the gold standard, the United States continues to pursue a destructive course of deficit spending, Keynesian economics, unsound and unsubstantiated currency, and economic nationalization. It seems as if Red China has embraced capitalism to a greater extent than the United States, and while Fort Knox remains empty, China has even begun investing in American gold reserves, as reported by The Street (which also notes that because both the United States and China are signatories to the International Monetary Fund (IMF) Articles of Agreement, Article IV, Amendment I, ratified in 1978, member countries are forbidden from switching over to a gold standard; they are not allowed to peg their currencies to gold):

    But that doesn't mean that China won't try to legitimize its currency by ramping up its gold holdings. The U.S., which sports the current world reserve currency, holds more than 8,000 tons of gold, more than 8 times the size of the SPDR Gold Shares [the largest gold exchange traded product and second largest exchange-traded fund in the world by market capitalization, accounting for over 80 percent of the gold within the Exchange Traded Gold group].

    Not only has China been furiously buying gold, but local gold producers have been looking outside the country to find more gold. State-controlled China National Gold Corp bought half of Coeur d’Alene Mines’ gold concentrates from its Kensington gold mine in Alaska.

    This seems to be in fulfillment of Vladimir Lenin’s prophetic warning that Communists would “hang the capitalists with the rope they sell us,” as China economically surpasses the United States as it adopts the gold standard, using gold obtained from American mines. In fact, as far back as June 2009, China has been encouraging its citizens and companies to purchase as much American gold, assets, land, and commodities as possible, much of which China owns as part of America’s indebtedness to China. According to a Reuters report, then-head of the Chinese Communist Party Economic Department policy research office Li Lianzhong declared that Beijing should use more of its massive foreign exchange reserves to buy gold to support its aim of raising the international role of the yuan currency, and encourage domestic enterprises to acquire foreign energy and natural resource assets by using part of the foreign exchange reserves.

    Furthermore, Chinese state TV has been featuring numerous Chinese investors trading in yuan paper notes for bars of gold, with China becoming the world’s largest buyer of gold. To quote Wang Zhenying, an official from the People's Bank of China:

    China will likely develop more yuan-denominated gold investment products, thus utilizing the more than 30 trillion yuan in savings the country has. A currency's international status depends on its being accepted in trade and settlement and having certain international commodities denominated in that currency helps China's goal to internationalize the yuan. Gold is a good choice to have yuan trading.

    It is a sad day for the United States when China adopts economic policies more capitalistic than the United States, and when Beijing is more willing to embrace the ideas of hard-currency advocates such as Murray Rothbard, Ludwig Von Mises, Lewis Lehrman, and Rep. Ron Paul (R-Texas) than is Washington, D.C. As long as America continues down its destructive path and allows Fort Knox to remain barren, China will keep on charging toward its goal of global hegemony, overpowering the United States — using the “rope” we sold them and utilizing the facilitating means we so easily surrendered.

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    Nikita Khrushchev: "We will bury you"
    "Your grandchildren will live under communism."
    “You Americans are so gullible.
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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    Bank of India DROPS Dollar in trade with China - They now ONLY take the Chinese Yuan!

    This has got to have the U.S. government in an absolute tizzy and beside themselves! The U.S. went into Iraq for less than this (daring to sell oil in Euros) and dropping the dollar.

    India is now trading with China using the Chinese Yuan and has dropped the U.S. dollar completely!

    This is huge the two largest growing economies are now trading between each other without using the dollar! India and China feel the Yuan is more stable than the U.S. dollar now, as it is not being inflated.

    Portion:

    Indian buyers are at present making payments in US dollars, and they often have to convert rupee into the US currency for the purpose. The US dollars will no more be the intermediary currency as the BOI is offering direct settlement between the rupee and the Chinese money.

    Chinese exporters want their money in the local currency, which is regarded as more stable compared to the US dollar. They are also in a position to have their way because Indian buyers do not have an alternative source of low-cost goods, sources said.


    Now the Chinese Yuan is the currency of trade between Russia and China (they dropped the dollar last year in trade between the two), besides India and China. The Asian countries had begun trading between each other in the Yuan last year, but huge countries had held back, besides Russia.

    Is this the start of more countries taking the step of using the Chinese Yuan as the currency of trade?

    We can thank Bernanke and the U.S. government for printing U.S. dollars into oblivion. Here is the graph released from the Fed Reserve Bank of St. Louis of how many dollars have been printed.



    Even those who have been keeping their heads in the sand about what is really happening, should look at that graph and gasp! As soon as the rest of the countries take the step that India and Russia have and the dollar is dropped everywhere, we will be Zimbabwe.

    I wouldn't be surprised if even our most trusted and close allies announce in the not too distant future they will be trading with China using the Yuan and dropping the dollar. Imagine if Australia/France and other European countries take this step.......... do you doubt they will at some point in the future, to protect themselves?

    Last month (January) the news had come out that India and Iran were coming to an agreement to trade Oil for gold between the two countries.

    The writing is on the wall - have you paid attention? Do you have investments that will protect you when the U.S. dollar is rejected by all the countries as the trading currency? There have been enough people warning everyone this was coming, so no one should be shocked or surprised when it happens. Unless of course they only listen to MSM and hear how "Wonderful, everything is".


    -----------------------------------------------------------------------------------


    A sneak attack on the U.S. dollar?
    By: Eamon Javers
    April 1, 2009 04:19 AM EST

    The war began with a press release.

    Dated May 13, 2010, it came from the Central Bank of the Russian Federation and said the Russian government “hereby announces the following facilities and processes which are in place and available for counterparty inquiry immediately.”

    Sounds innocent enough, but savvy investment experts got the message: It was the opening salvo in a sneak economic attack on the U.S. dollar.

    The Russian Central Bank was creating a new global currency, the “gold reserve dollar,” which would be issued by a financial agent in London and backed by tons of Russian gold shipped to secure vaults in Switzerland, the press release said.

    The goal: to drive the value of the U.S. dollar down by 75 percent overnight and wreak havoc on the struggling American economy.

    Thankfully, the press release was a fake. It was written by economic intelligence analyst James Rickards and presented on March 24 to the Unrestricted Warfare Symposium at the Johns Hopkins University Applied Physics Laboratory.

    But Rickards’ point was all too real: The American dollar is vulnerable as never before to attack from hostile foreign governments. And the consequences of such an attack could be devastating . . .
    Full article: http://www.politico.com/news/stories/0309/20723.html

    Now, compare that with a story barely covered yesterday:

    China "Attacks The Dollar" -

    Moves To Further Cement Renminbi Reserve Currency Status

    By Tyler Durden
    Created 03/02/2011 - 20:24
    In a surprising turn of events, today's biggest piece of news received a mere two paragraph blurb on Reuters [1], and was thoroughly ignored by the broader media. An announcement appeared shortly after midnight on the website of the People's Bank of China.

    Reuters provides a simple translation and summary of the announcement: "China hopes to allow all exporters and importers to settle their cross-border trades in the yuan by this year, the central bank said on Wednesday, as part of plans to grow the currency's international role. In a statement on its website www.pbc.gov.cn, the central bank said it would respond to overseas demand for the yuan to be used as a reserve currency. It added it would also allow the yuan to flow back into China more easily." To all those who claim that China is perfectly happy with the status quo, in which it is willing to peg the Renmibni to the Dollar in perpetuity, this may come as a rather unpleasant surprise, as it indicates that suddenly China is far more vocal about its intention to convert its currency to reserve status, and in the process make the dollar even more insignificant.

    Source URL: http://www.zerohedge.com/article/chi...serve-currency

    Sound Familiar? Today's announcement certainly sounds a great deal like the warnings from two years ago.

    Also, a lot of our contacts have been asking about the recent press. I'll post the Gertz article and links to the Fox News, CNBC, as well as the Glenn Beck comments tomorrow.




    Posted by Kevin Freeman at 3/3/2011 9:49 PM | Add Comment
    Economic Reality?

    Before the 2008 crash, it was common belief that the Chinese economy would overtake the United States in 40-50 years. Then, near the lows in March 2009, Jim O'Neill from Goldman Sachs altered his forecast to suggest that China would overtake the U.S. in "less than 20 years." Now, after the smoke has cleared, the latest forecast from Citi suggests that even with strong domestic growth, China will become the world's largest economy in less than a decade.

    It is important to note that this matches precisely with what we believe is the goal of the latest Five Year Plan from the Chinese Communist Party as described in the previous post:
    "The goal of the national 12th FYP (Five Year Plan) is to smooth the way for the Chinese economy to overtake that of the U.S. in ten years or less. The military MFYP’s objectives are similar: to expeditiously close the gap between the PLA’s capacity and that of the U.S. armed forces."
    US Will Be the World's Third Largest Economy: Citi



    US, ECONOMY, BIGGEST, LARGEST, CHINA, INDIA, EMERGING MARKETS, ECONOMIC GROWTH, POPULATION, DEMOGRAPHIC, RECESSION, RECOVERY
    Posted By: Patrick Allen | CNBC EMEA Head of News CNBC.com | 25 Feb 2011 | 04:19 AM ET

    The world is going to become richer and richer as developing economies play catch up over the coming years, according to Willem Buiter, chief economist at Citigroup.

    "We expect strong growth in the world economy until 2050, with average real GDP growth rates of 4.6 percent per annum until 2030 and 3.8 percent per annum between 2030 and 2050," Buiter wrote in a market research.

    "As a result, world GDP should rise in real PPP-adjusted terms from $72 trillion in 2010 to $380 trillion dollars in 2050," he wrote.

    As the world watches oil prices rise sharply amid unrest in the Middle East, Buiter's analysis of the world's long-term prospects offer some hope that better times are ahead but if he is right power will shift from the West to the East very quickly.

    "China should overtake the US to become the largest economy in the world by 2020, then be overtaken by India by 2050," he predicted."

    To read the whole article, URL: http://www.cnbc.com/id/41775174/


    So, it's clear that the Chinese rise has actually benefitted from the 2008 crash. Instead of slowing down, the process of overtaking the United States has accelerated. At the same time, the Chinese have accumulated additional reserves while we have taken on more debt.

    The other area to watch is the global balance of wealth between OPEC and the Western World. Then last time oil prices were at these levels, the value of OPEC oil and gas recoverable reserves exceeded the total value of ALL of the world's financial assets. Given today's price levels, that is likely true today as well. Continuing Chinese growth will cause ever increasing demand for energy and likely ever-increasing prices. So, the other major winner of the financial collapse will be those who control OPEC oil supplies. Given the recent turmoil in the Middle East, we can't be certain regarding who will control all that wealth. The Muslim Brotherhood is certainly making a play for it now.

    The bottom line is that this is an Economic War being waged by sophisticated enemies with an agenda of dominance. It's time for our leaders to understand this reality as step number one.



    Posted by Kevin Freeman at 2/27/2011 11:54 AM | View Comments (3) | Add Comment

    The Chinese Take a Long Term View; Evaluating Their 5YP



    While Americans tend to focus on the next quarter or at least the next election cycle, the Chinese have tended to think in terms of decades. This can provide an enormous strategic advantage in many areas. It also requires a longer-term perspective when analyzing any Chinese actions. It is therefore important for our defense and intelligence leadership to carefully review China's 12th Five-Year Plan (12FYP) that covers the years 2011-2015 in light of what we have revealed in regard to Economic Warfare.

    According to a report by Willy Lam at East Asia Intel (
    http://www.east-asia-intel.com/eai/), the Chinese now believe that their long-term path to the dominant position economically and militarily is finally within their decade-long horizon:
    "While the world’s eyes are glued to China’s 12th Five-Year Plan (12FYP) (2011-2015), security experts are looking at leads and telltale tidbits about the People’s Liberation Army’s (PLA) military Five-Year plan (MFYP) for the same period. Unlike the civilian version, the gist of which will be released at the National People’s Congress in early March, the MFYP will remain under wraps.The goal of the national 12th FYP is to smooth the way for the Chinese economy to overtake that of the U.S. in ten years or less. The military MFYP’s objectives are similar: to expeditiously close the gap between the PLA’s capacity and that of the U.S. armed forces."
    We have already demonstrated in our prior reports:

    1. That the Chinese strategic military doctrine of Unrestricted Warfare call for the use of economic weapons against U.S. interests if necessary to achieve Chinese goals. This was published in 1999 by the PLA Press, reflecting the approved thinking of the People's Liberation Army.
    2. The ruling Communist Party essentially agreed with the doctrine of Economic Warfare and recently advocated its use against the U.S. in its official publication, Qiushi Journal.
    3. That even while pursuing Economic Warfare efforts, the Chinese very actively hide such efforts, masking them as "market forces."

    The nature of the next phase of Economic Warfare is also well defined. We have termed it Phase 3. According to the Qiushi Journal, there is a very clear understanding of the vulnerability of the U.S. dollar as reserve currency. Likewise, the Chinese are well aware of the high U.S. debt levels and how to use them to their advantage. They also clearly understand energy issues that we face due to political constraints. Finally, the Chinese understand that U.S. budgetary problems will likely lead to a scaling back of defense expenditures just as they continue to build the PLA. Ironically, we pioneered a similar strategy that was effective in collapsing the Soviet economy and ultimately the Soviet Union.

    Many have argued that the Chinese threat is overstated. They base such arguments on the belief that the Chinese would never act against their economic interests. They also point to the Chinese military budget as being less than 20% of U.S. military spending. Both arguments have serious flaws. First, we know that the Chinese had serious holdings in Lehman Brothers, Fannie Mae, and Freddie Mac. Yet, despite their collapse in late 2008, the Chinese still emerged substantially stronger on a relative basis in the global economy. In other words, despite losing money they advanced toward the goal of being the top economy in the world. In an economic warfare perspective, this is simply suffering casualties while gaining the objective.

    In terms of military spending, there are two major flaws of understanding. First, Americans tend to think only in terms of hardware and personnel. The Chinese think in terms of technique. So, is economic espionage included in the military budget? No, but it does represent part of the Unrestricted Warfare strategy. The same may be said for use of cyber weapons and market manipulation. At the same time, most experts agree that the official Chinese military budget reflects only about one-third of actual expenditures. This is true to both confuse the West and to hide reality from liberal intellectuals in the country who are demanding greater expenditures on social welfare programs. The way the economy is structured with such a vast array of State-run enterprises, the world may never know exactly how great the military budget actually is.

    As for the willingness to use Economic Weapons, according to a recent Wikileaks of confidential diplomatic cables, that process has already begun. In fact, according to those cables, Chinese officials pressured Treasury Secretary Geithner to support an expedited purchase of $1.2 billion of shares in Morgan Stanley. While there is no record of Geithner's response, only a single day later the Chinese Investment Corp (a $200 billion Chinese Sovereign Wealth Fund) announced the purchase. All of this is contained in a Reuter's report from 17 February 2011:

    Special report: China flexed its muscles using U.S. Treasuries
    http://www.reuters.com/article/2011/...71G47920110217
    .

    To summarize:


    1. The Chinese take a long-term view.
    2. Their goal is to achieve economic and military superiority within a decade.
    3. They recognize the value of Economic Weapons, including collapsing the dollar if needed to achieve their goals.

    We know all of this from official sources. We also have evidence that supports this reality. Most recently, we see that the Chinese are acquiring gold at a very rapid pace. According to a report in The Street, (http://www.thestreet.com/story/11009...-standard.html):
    "China bought 175.2 tons of gold in the fourth-quarter of 2010, bringing its grand total for the year to 579.5 tons, or 18.5 million ounces, according to the World Gold Council. That's a lot of gold. The U.S., in comparison, consumed 233.3 tons in 2010. It's unknown how much of that gold was consumed by citizens or its central bank, but the question still remains — What will China do with all that gold? There is a controversial theory percolating in the gold community that China wants the yuan to become the world's reserve currency and is buying gold and silver in order to do it."
    While we can't know for certain, the rapid acquisition of gold represents another significant puzzle piece that is consistent with other evidence suggestive of Economic Warfare as we have been describing.


    Posted by Kevin Freeman at 2/21/2011 4:00 PM | View Comments (2) | Add Comment

    China Ready for Economic War (analysis)

    The Times of India reports (based on Qiushi, the official Communist Party publication) that the Chinese are planning a Phase 3 Economic War (as we have warned for two years).

    We already are aware of the Chinese strategic doctrine of Unrestricted Warfare as published by the PLA in 1999 that supports what we have been saying 100%, but also now we have the official publication of the Communist Party outlining plans for an economic war against the United States. This is exactly what we predicted in the paper written for DoD nearly two years ago. [We posted on Unrestricted Warfare earlier in the Blog.]


    What is so essential about this article is that it:

    1) Acknowledges what we have been sharing that our primary vulnerability is economic. They see our currency and free markets as a weapon to use against us.
    2) Blatantly proclaims that they will use market forces to mask their intended activity. [I believe they have been doing this for years.]
    3) An intention to use our free media (as opposed to State-controlled) to launch a public-opinion war.

    We have a very clear outline of intentions. For years, they have been masking their efforts as "market forces" and obfuscating their efforts in the media. Now we have a clear acknowledgement in their own paper of such efforts.

    It is absolutely essential that our leaders, especially those charged with defending our national interests begin to acknowledge and understand this issue. My report produced for DoD in early 2009 is a good primer on the subject. Since then, I have continued to monitor, inform, and educate as many as I can. This Blog is one forum that enables information to be disseminated.



    This is a commentary on an article in today's edition of the Times of India (excerpts and a link to the full article can be found on the Blog).

    Posted by Kevin Freeman at 2/12/2011 1:19 PM | Add Comment


    China Ready for Economic War (the article)
    Excerpted from Times of India:

    'China ready to go to war to safeguard national interests'


    PTI, Feb 12, 2011, 04.06pm IST

    BEIJING: Terming US attempts to woo India and other neighbours of China as "unbearable," an article in a Communist party magazine has said that Beijing must send a "clear signal" to these countries that it is ready to go to war to safeguard its national interests.

    The article published in the Qiushi Journal, the official publication of the ruling Communist Party of China (CPC) said China must adhere to a basic strategic principle of not initiating war but being ready to counterattack.


    "We must send a clear signal to our neighbouring countries that we don't fear war, and we are prepared at any time to go to war to safeguard our national interests," the article said, suggesting an aggressive strategy to counter emerging US alliances in the region....

    "Throughout the history of the new China (since 1949), peace in China has never been gained by giving in, only through war. Safeguarding national interests is never achieved by mere negotiations, but by war," it said.

    It suggested that China should use its economic clout and trade as a weapon to rein in neighbours....


    China on its part, it said, can consider the idea of launching economic warfare through strategies to contain the US dollar and making effective use of forums like the IMF and initiating a space war by developing strong space weapons...
    It also said the China should also launch a public opinion war by making an effective use of the free media in the US and other democracies.

    "Of course, to fight the US, we have to come up with key weapons. What is the most powerful weapon China has today? It is our economic power, especially our foreign exchange reserves (USD 2.8 trillion). The key is to use it well. If we use it well, it is a weapon; otherwise it may become a burden," it said.


    China, it said, should ensure that that fewer countries should keep their forex reserves in US dollars.

    "China, Japan, the UK, India, and Saudi Arabia are all countries with high foreign exchange reserves," it said analysing each country's ability to align with China against the US.

    So in view of this China should "pick up courage" and go for aggressive buying of other currencies, including the Indian Rupee hence taking the lead in affecting the market for US dollars.

    This approach, it said, is market-driven and it will not be able to easily blame China.

    "Of course, the most important condition is still that China must have enough courage to challenge the US currency. China can act in one of two ways. One is to sell US dollar reserves, and the second is not to buy US dollars for a certain period of time," which will weaken the currency and cause deep economic crisis for Washington.

    Given the fact that China is the biggest buyer of US debt, its actions will have a demonstrable effect on the market.

    "If China stops buying, other countries will pay close attention and are very likely to follow. Once the printed excess dollars cannot be sold, the depreciation of the dollar will accelerate and the impact on Americans wealth will be enormous.

    "The US will not be able to withstand this pressure and will curtail the printing of US currency," it said.



    Read more: 'China ready to go to war to safeguard national interests' - The Times of India http://timesofindia.indiatimes.com/w...#ixzz1Dlgtl6H0


    Posted by Kevin Freeman at 2/12/2011 12:39 PM | Add Comment

    Lessons from Egypt



    For several decades, Egypt has been considered an important American ally in the Middle East. The nation, under Mubarak has also been a source of stability and peace, including with Israel. The regime was dictatorial and even brutal, especially against elements such as the Muslim Brotherhood. The toppling of Mubarak offers some important lessons on many fronts.


    For students of financial terrorism and economic warfare, there are two primary takeaways:

    1) The trigger to the unrest was food prices. It has been widely reported that food inflation was a if not the primary factor behind the initial unrest. Egyptian households spend about 40% of their budget on food and food prices increased 20% in the past year. Corn prices shot up 90% and wheat slightly less.

    2) Speculation played a role in higher food prices. Certainly the global monetary inflation made this possible. Another factor has been economic progress in emerging markets whereby people have been improving the quality and quantity of their diets. Both of these have justified higher prices. Speculation has been a factor on the margin. As we know, however, the marginal factors are generally the ones that create a tipping point. My sources tell me that this has been the case so far and that speculative interest in food is growing,

    Both of the takeaways are factual.There should be no doubt that there was a serious economic component behind the events in Egypt. The question then becomes whether or not additional speculation on food prices could be used as a geopolitical lever. Based on our research, the answer is an unequivocal yes.

    We are not saying that the Muslim Brotherhood speculated on food prices as a weapon to topple Mubarek, although some sources say that was the case. We are saying that whether or not they did, it is obvious that such a weapon could be used, albeit imprecisely. If done properly, it could even be used profitably. The cost is certainly less than a major arms program but the results are dramatic.

    We would hope that our Intelligence Community has studied this in detail and prepared contingency response sets. Based on the fact that Obama's Intel Chief, Admiral Clapper, believes that the Muslim Brotherhood is a "secular" organization, we aren't very confident. For more than two years I have been informing and educating the Defense and Intelligence communities regarding the risks of financial terrorism and economic weapons. Some are beginning to notice.


    Posted by Kevin Freeman at 2/11/2011 11:00 AM | View Comments (1) | Add Comment

    Foreign Control of our Capital Markets?



    It has been widely reported that Deutsche Börse of Germany will be absorbing the New York Stock Exchange if a planned merger is allowed to consummate. Make no mistake, regardless of how this is spun, it reflects a decline in American position. It may also be a serious risk to America's national security and sovereignty.

    The Wall Street Journal stated it this way:
    Planned Deal Marks NYSE's Decline

    http://online.wsj.com/article/SB1000...LEFTTopStories

    There has already been a good deal of commentary on the economics of the deal. According to the release, there will be efficiency-based cost savings counted in the hundreds of millions of dollars per year. What has barely been discussed, however, are the national security implications. On CNBC tonight, Larry Kudlow touched on this with guests Harvey Pitt (former SEC Commissioner), and California Congressman Ed Royce. One of the key questions they addressed is, "Who would have regulatory authority? Would it be the U.S. or the 60% German owners?

    Obviously, Germany has been a long-term ally. But, there is a whole new layer of complexity having the Germans in control. For example, we can't be certain how much Chinese or Middle Eastern money may be hidden in the German offer. Given everything else we have uncovered on this Blog and in our research, we should be VERY careful about giving up our economic sovereignty. Our economy depends on our capital markets. It is essential that they are free of any potentially subversive elements. Our future depends on it.


    Posted by Kevin Freeman at 2/9/2011 7:00 PM | Add Comment


    NASDAQ Admits Hacker Attempts, But Told to Keep Quiet



    Following the release by the Times (London) of our DoD report on financial terrorism (see previous post), a series of revelations have supported its conclusions. The most recent has been an admission by NASDAQ that they discovered secret files placed on their computers without their knowledge. At about the same time, the FBI admitted that they had been warning Wall Street firms that they had information suggesting that there is an intended attack by jihadists.


    Nasdaq admits security breach, denies data access by hackers


    http://www.banking-business-review.c...hackers-070211
    Published 07 February 2011
    "Nasdaq OMX Group has admitted that it found suspicious files on its US computer servers, but denies that hackers had accessed or acquired customer information or that its trading platforms were compromised.The admission comes in the wake of series of media reports that hackers have repeatedly made their way into the computer network that runs the Nasdaq Stock Market during the past year.
    Nasdaq said the files were detected late last year, and it immediately contacted forensic groups and US law enforcement agencies.The attack came in the form of suspicious files known as 'malware', pointed at Nasdaq's Directors Desk service, a web-based application where some 5,000 companies store documents for board members.
    The Federal Bureau of Investigation is investigating the attacks alongside the US Department of Justice, but officials have remained silent and no one is authorized to release a statement at this time."
    The reason that this is so significant is because most of our leaders have been living in denial on this very important issue. I have briefed leaders in both House and Senate as well as major agencies. Many found our claims of current and planned attempts to bring down our economy "too frightening to imagine." This seems remarkably like the Ostrich—-hide your head in the sand and hope the bad things go away. Fortunately, we have found some good people in the leadership who are willing to listen, learn, and address the problem.

    Our group has incredible documentation that demonstrates the intent to attack our economy from original documents produced by China, Venezuela, other nations and various Islamic Jihadists. They state in very direct terms an understanding of how to bring down our financial markets as well as, in most cases, a desire to do so. My research has clearly demonstrated vulnerability. Now, in addition to everything my group has provided before in this regard, we have clear and compelling proof that attacks have been undertaken. This should be no surprise. America has enemies who hate everything our nation has represented. We are a nation built on Judeo-Christian principles, loves freedom, and stands for truth. The financial markets simply represent a potential vulnerability. Better said, our open markets can serve as a weapon against us if we remain ignorant and unprepared.

    Please understand that there is substantially more to these stories than has been shared with the public. In fact, CNBC provided the following revelation (http://www.cnbc.com/id/41463670):"Nasdaq was advised by federal law enforcement officials not to alert its existing customers of the cyber attacks..."

    There are two points:

    1) It should be abundantly clear that our financial markets are targets. Anyone who believes this is isolated is simply naive. There are very likely many other instances in which we simply haven't yet discovered the intrusion.
    2) We know for certain that even when attacks have been discovered, officials have made efforts to keep the information from getting out to the public.

    When you understand these two truths, you understand that the public is made aware of only a portion of what officials know and there is still likely much that officials don't yet know.

    Stay tuned to both the news and this Blog. You will increasingly see evidence that supports what we have been sharing regarding Financial Terrorism and Global Economic Warfare. We are making every effort to work with leaders and law enforcement to keep our markets and economy safe.



    Posted by Kevin Freeman at 2/8/2011 10:59 AM | Add Comment


    Financial Terrorists Pose Grave Risk to U.S.



    Story that appeared in Times of London yesterday:

    Financial Terrorists Pose Grave Risk to U.S.
    Alexandra Frean New York
    Last updated February 2 2011 12:01AM
    The US financial system remains vulnerable to a co-ordinated act of “financial terrorism” that risks taking down the US economy and collapsing the dollar, according to a confidential report commissioned by the Department of Defence in Washington.
    The document warns that forces hostile to the US could mount a “focused effort to collapse the dollar by dumping Treasury bonds” and urges the security services to conduct a further risk assessment “outside of traditional Washington and Wall Street circles”.
    It also suggests that the financial meltdown of 2008, which wiped out an estimated $50 trillion of global wealth, may not have been the spontaneous result of poor regulation and bad risk assessment among financial institutions, but a co-ordinated series of attacks by “financial terrorists intent on destroying the American financial system”.
    The disclosure of the report’s contents to The Times came as the FBI confirmed that it had warned major Wall Street institutions of a potential threat to their businesses and executives after an al Qaeda-linked magazine, Inspire, suggested that financial markets could be a target of attack.
    A spokesman for the FBI in New York confirmed yesterday that security briefings for Wall Street firms took place last month, but said that the information that was discussed was “not imminent, not specific”. The briefings reflect concerns in some quarters of the Pentagon about the vulnerability of America’s financial and economic system to terrorist attack.
    The FBI move follows revelations in The Times this week that stock exchanges in Britain and the United States have turned to the security services for help after discovering that they were the victims of terrorist plots and attempted cyber attacks that aimed to spread panic in leading global financial markets last year.
    The 110-page document commissioned by the Irregular Warfare Support Program (IWSP) of the US Department of Defence is entitled Economic Warfare: Risks and Responses. It has been circulated among defence chiefs in Washington but has never been made public. It was delivered to the IWSP in June, 2009, eight months after the collapse of Lehman Brothers triggered the financial crisis, but has remained under wraps since then as the attention in Washington focused instead on introducing financial reforms.It resurfaced two months ago when it was submitted by the Department of Defence to the Financial Crisis Inquiry Commission (FCIC), the official US Government-appointed body investigating the causes of the 2008 crisis.
    The report examines the possibility that gaps in the US financial regulatory system “were subject to exploitation not only by greedy capitalists seeking profit, but also by financial terrorists intent on destroying the American financial system”. It adds that high levels of debt, especially housing debt, taken on by American households added to the country’s vulnerability.

    Drawing heavily on academic and other texts, the report outlines a scenario in which US economic security could be undermined in a three-phase attack. The first could have been the surge in oil prices fuelled by speculators in 2007. The second phase would have begun in 2008 with a series of bear raids targeting US financial services firms, most particularly Bear Stearns and Lehman Brothers, in which investors bet that the stock of those companies would fall in value.

    The third phase could take the form of a direct economic attack on the US Treasury and US dollar, the report says.

    “A focused effort to collapse the dollar by dumping Treasury bonds has grave implications including the possibility of a downgrading of US debt and... removing [the dollar] from reserve currency status,” it says.

    “Such an event has already been discussed by finance ministers in major emerging market nations, such as China and Russia, as well as Iran and the Arab states,” it adds.

    The report suggests that any number of foreign-based individuals or organisations, ranging from sovereign wealth funds to Russian mobsters and al-Qaeda and even one or more of Brazil, Russia, India and China could have the means and motive to perpetrate or commission acts of financial and economic terror on the US. While it does not accuse any of these parties of wrongdoing, it outlines the potential threat they pose and concludes that the fact that there is reasonable credibility to this threat “justifies very serious consideration”.

    “Ignoring the likelihood of this very real threat ensures a catastrophic event,” it warns. The report recommends the creation of a special unit to “implement appropriate counter-measures to emerging threats in co-ordination with key defence, intelligence, and financial agencies.”


    The document’s author, Kevin D Freeman, is founder and chief executive of Freeman Global Investment Counsel, a boutique investment advisory firm, who was commissioned by the Department of Defence in 2009.


    Although the views contained in the report represent Mr Freeman’s views and not those of the Department, e-mails seen by The Times confirm that the department commissioned the report, circulated it among defence chiefs and passed it to the FCIC in November or December last year.

    The US Department of Defence declined to comment on the report.

    Posted by Kevin Freeman at 2/3/2011 12:21 AM | Add Comment


    Financial Warfare in Egypt



    Nearly everyone on the planet is aware of the riots taking place in Egypt. Most understand that there are serious geopolitical ramifications.

    When you look behind the cause of the riots, however, it begins to become obvious that there was an economic trigger. High unemployment rates with rising food and energy prices may not have been the only cause behind the turmoil. But, no objective analyst can deny that they were a, if not the serious factor at work.

    There's no doubt that numerous factions are currently exploiting the situation. Egypt has been under dictatorial rule for decades. Nevertheless, the situation there now echoes the truths of Economic Warfare. Regardless of the cause in operation now, we have proven that it is possible to manipulate commodity prices, at least for short periods. It may even be done undetected.

    I have heard rumblings that Egypt may currently be the target of economic warfare. At a minimum, my research suggests that current events are collateral damage from financial weapons.

    So, the questions of the day:

    1) What role, if any, is economic warfare playing in destabilizing Egypt?
    2) Even if not at work there now, are terror factions learning from the situation, ready to use economic weapons in the future?

    Controlling food supplies is an age-old method of warfare. Controlling food prices via market mechanisms is a new form of that weapon that could be utterly devastating. The Chinese call this a "new concept weapon" in their book Unrestricted Warfare. Their comment on America in this area:
    "the Americans have not been able to get their act together in this are (new concept weapons). This is because proposing a new concept of weapons does not require relying on the springboard of new technology, it just demands lucid and incisive thinking. However, this is not a strong point of the Americans, who are slaves to their technology in their thinking."

    What this says is that we may be playing checkers while others are playing 3-dimensional chess. I have seen that first-hand with many of our defense and intelligence experts who stretch to even imagine that the financial markets could be weapons. Fortunately, a few "get it" and have been working to address the serious issues.

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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    Companion Thread and Post:



    BRICS Leaders Attack U.S. Dollar



    Written by Alex Newman
    Thursday, 21 April 2011 11:29



    Brazil, Russia, India, China, and South Africa, the so-called “BRICS” countries, added more pressure against the U.S. dollar after their leftist leaders called for a new international monetary system and announced that they planned to start issuing credit for trade among themselves using their own currencies.

    Following a one-day summit in China last week, the leaders of the BRICS nations released a statement calling for a wide range of significant political and economic reforms at the global level. Most alarming to analysts, however, were the barely veiled attacks against the U.S. dollar and its status as the world's reserve currency.

    “Recognizing that the international financial crisis has exposed the inadequacies and deficiencies of the existing international monetary and financial system, we support the reform and improvement of the international monetary system, with a broad-based international reserve currency system providing stability and certainty,” the rulers said in their joint declaration. They also repeatedly called for increased “global economic governance,” capital controls, and international financial regulation.

    In another shot at the dollar, the five leaders also brought up the possibility of expanding and solidifying the push toward a new world currency system. “We welcome the current discussion about the role of the [International Monetary Fund’s proto-global currency known as Special Drawing Rights, or SDR] in the existing international monetary system,” they said in their joint statement.

    And finally, the leaders agreed to cut the U.S. dollar out of their trade-credit systems as much as practical in the future.

    "Our designated banks have signed a framework agreement on financial cooperation which envisages grant of credit in local currencies and cooperation in capital markets and other financial services," leftist Indian Prime Minister Manmohan Singh said at a press conference. Analysts expressed skepticism about the scheme, but it is indicative of anti-dollar trends gaining steam worldwide.

    The other main point of the statement — besides attacking the dollar and the global monetary system it underpins - can essentially be summed up as the promotion of shift in power.

    Governance and authority should migrate to the regional and global level — and away from national, state, and local government.

    Calling for comprehensive reform of the United Nations, the joint statement declared that the world body should play “the central role in dealing with global challenges and threats.”

    Later on, it suggested that the UN has a “central role in coordinating the international action against terrorism.”

    Of course, the alleged need for the global body to address so-called “climate change” was a prominent feature of the final agreement as well. And support for the UN’s “Agenda 21” and its “Millennium Development Goals” was right up there, too. Strong backing of the World Trade Organization was also mentioned.

    The so-called Group of 20, a high-level consortium of the world’s most powerful governments, should see its power expanded as well, the BRICS leaders agreed. The G20, for example, should play a “bigger role in global economic governance,” they said.

    “We call for a quick achievement of the targets for the reform of the International Monetary Fund agreed to at previous G20 Summits,” the statement noted, referring to the notion that other governments including the communist Chinese regime should have more influence at the IMF.

    Several smaller points were also made. For instance, the rulers declared that more handouts of money and technology from the West to “developing countries” should be a priority.

    They also agreed to collaborate more on “gender equality” and fighting HIV, among other things. And there was even some mild criticism of Western intervention in the Middle East and North Africa, too.

    The rulers present at the BRICS summit — all them representing varying degrees of statism ranging from “democratic socialists” to outright brutal, murderous communists — were Indian Prime Minister Manmohan Singh, Chinese communist strongman Hu Jintao, Brazil's former communist terrorist Dilma Rousseff, Dmitry Medvedev of Russia and South Africa's Jacob Zuma.

    While the five nations represent almost 40 percent of the world’s population, their economies account for about 20 percent of global GDP right now. Analysts, however, expect their growing economies to eventually contribute far more to global economic output in the not-too-distant future.

    As The New American reported last year, a powerful coalition of national rulers, international institutions, prominent economists, media outlets and other actors is aiming to eventually develop a world fiat currency managed by a global central bank. Whether the BRICS leaders’ agreements will contribute toward that goal remains to be seen, but their attacks on the dollar certainly won’t be good for America’s currency.

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    Default Re: Secret moves launched by China, Russia, Japan, France, Arab States to end the Dol

    Fightin' words.

    Words mean things. The US will sit on it's ass (read: Obama) and not do jack about this. The media will have a field day, markets will splatter.

    This is what I am talking about in the other thread.

    The guys (BRICS) are doing things and SAYING things that will cause the market to falter.

    People will panic and do dumb things.

    Looks like it is time to invest in BRIC....
    Libertatem Prius!


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