Jim Willie: Global Currency Reserve at Risk – July 15,
2017
Within the US borders, the population remains largely
ignorant of the true significance of the global currency reserve concept. It is
of paramount importance, yet almost never discussed in the financial press. The
public within the United States simply assumes the country operates with the
USDollar as its currency, with near blindness to its global role in trade and
banking. The end of an era is coming, as the change will be powerful in its
effect. The shock wave could hit this year in some form, in a manner to
highlight its importance.
MEANING OF CURRENCY RESERVE
The term is tossed around in common manner, often without an
explanation of what it means. A strict meaning is followed by a practical
meaning. The USDollar serves as global currency reserve, insofar as the
USTreasury Bond is the standard for bank reserve core asset usage. Numerous
countries have a core foundation to their national banking system. They maintain
core assets and ratios. It is not gold bullion, but rather the USGovt debt. It
is the USTBond denominated in USDollars. Of course, such practice is upside down
and lunatic. Debt operating as core assets in the global banking system is
utterly reckless, insane, and bound to force a systemic breakdown. Such is the
heresy and risk from the banker cabal.
The practical side of global currency reserve system is that
trade payments are standardized as being executed in USDollar terms. A crude oil
shipment, a grain shipment, a container vessel shipment, they are paid in USD
terms, often with short-term USTreasury Bills. Also, international contracts
like for consulting services or for installation of IT systems typically are
written for payment in USD terms. As a result, the nations set to pay for a
shipment or contract maintain huge USTreasury stores in their banking systems,
ready to complete the trade payments.
ULTIMATE LOST PRIVILEGE
The King Dollar and its court of financial terror is
destined to lose its privileged perch. The abuse to maintain the global USDollar
financial system is universal and profound. It all engenders tremendous
resentment and backlash in the form of resistance, together with concerted
movements toward the non-USD platforms. The movements are emerging from the
East. When the global reserve currency status is lost, the American public will
face severe problems never before encountered. They will be very confused. They
will be lied to in a big way. Consider the import price inflation, the supply
chain shortages, and the civil disorder. Running the USEconomy and USGovt on
an international credit card, without ever paying the bill, has a certain
limited duration. When the reserve status ends, the privilege ends, and the
shock begins.
EAST TO CONTROL TRADE PAYMENT
The Eastern nations control significant manufacturing
facilities toward the global economic output. Such is the case after a full
generation of outsourced industry by Western corporations. At first it was the
Pacific Rim in the 1980 decade. Then it was India, Brazil, and a host of other
burgeoning nations striving for further development. The West controls the
financial markets, with all the elaborate paper instruments, and all the
sophisticated market rigging machinery. If it controls anything, the East
controls the manufacturing sector. Therefore these nations, led by China and the
Pacific Rim, within which is the key player Taiwan, are in a position to dictate
the terms of trade payment. The standard as of now is the USTreasury Bill. This
will ultimately change, and when it does, the USDollar will officially shed its
global reserve status. The impact will be enormous.The Eastern nations,
perhaps under the aegis of the Eurasian Trade Zone protective shadow, are in a
position to demand alternative forms of trade payment. Consider the Chinese
RMB currency, the Ruble currency, or soon the Gold Trade Note. With
manufacturing prowess comes the power to dictate trade payment. The risk to the
USEconomy is cutoff for supply into the many sectors, most visibly the retail
sector. All the while, the One Belt One Road set of massive projects
will be conducted outside the USDollar sphere.
CRUDE OIL AS NEXUS
The initial impact is most likely to occur within the crude
oil market. The key region for the Petro-Dollar defacto standard has been for 40
years the Arab Gulf Region. The OPEC oil cartel has been led by the Saudis, who
operate as puppets for the Anglo-American helm and the banker cabal. The Saudis
are in heated conflict with Qatar, as the Petro-Dollar has fractured in full
view. The Saudis are in an ugly war with Yemen, in order to steal energy
reserves. If truth be told, the Saudis are bankrupt and broken. Enter
into the void the Natural Gas Cartel, led by Russia, Qatar, and Iran.
It is in the formative stage here and now. The key event upcoming is for the
Chinese to win the right to pay for Saudi oil in Chinese RMB terms.Following
this will be Kuwait, Oman, UAE, and other Arab oil monarchies. The event will
mark the final nails in the Petro-Dollar coffin, whose standard structure has
been undergoing disintegration for three years.
LAUNCH OF NEW SCHEISS DOLLAR
This is inevitable, a domestic only new USDollar. The
Jackass has harped on this topic for two years or more. It is not folly, but
rather a reality which approaches closer with every passing month. In time,
the Eastern nations will not accept USTBills as trade payment. They will
reject the USDollar for its fallacious underpinnings and fraudulent activity and
the folly of its management. The King Dollar is backed by the USFed and hyper
monetary inflation, called euphemistically Quantitative Easing. It means the
rules for limiting the quantity of dollars is relaxed, and African style
monetary inflation is permitted. This is reckless and heretical, since the
USDollar is the global reserve currency. All national banking systems are
undermined by the QE process. The King Dollar is also backed by war, sanctions,
and threats of war. The nations which work to sell oil outside the USD sphere
have been subjected to war invasion (see Iraq), to sanctions (see Iran), and to
global war with conflagration (see Russia).
The rejection of the USDollar in trade payments will mark
the beginning of a critical new chapter in modern history. The end of the
Petro-Dollar defacto standard will usher in the dawn of the NatGas Cartel and
the urgency for launching the New Scheiss Dollar. Given the $550 billion
national trade deficit, the USGovt will see massive pressure for devaluation of
the New Scheiss Dollar, like 30% every six months. The USGovt will most likely,
given its past corrupt history, present a fallacious backing for the new
currency. They are likely to present a false gold backing like the infamous
ludicrous Deep Storage Gold ledger item. They are likely to present an
inadequate oil reserve as partial basis. Keep in mind that the Strategic
Petroleum Reserve is worth around $7 billion. Therefore, the trade deficit
requires almost 80 such reserves to cover each year’s trade deficit. The USGovt
deficit is in the $1.2 to $1.5 trillion neighborhood. It must also be financed.
The painful devaluations will be necessary in order to finance the USGovt debt
and trade deficit with a cheaper domestic dollar. Washington will be under huge
pressure to attract foreign capital. It does not now, since it relies upon the
printing press and leveraged machinery. Welcome to the real world, where
fundamentals matter. With the higher import prices, will come product shortages
and empty shelves from lack of demand. Then comes the civil disorder. The
Jackass anticipates three centers will suffer riots and highly disruptive
events: supermarkets for food, gasoline stations for fuel, and ATM
machines for cash.
GOLD IMPACT
The impact felt across the entire financial structural
systems will be enormous when the King Dollar loses its prestige and elite
privilege, upon loss of the global currency reserve status. With the King
Dollar cut off at the knees, the scramble will be on to find a stable core
vehicle to serve as the foundation for the global financial system. Enter gold.
With the five-fold increase in the monetary supply in the last several
years, the solution will be that Gold will seek its proper water level, five
times higher in price. It is inevitable. It is as probable as the tide rising in
the Bay of Fundy in Maine, the northeastern-most point in the United States. The
tide is tremendous in its differentials, in the area among Maine, New Brunswick,
and Nova Scotia.
With the arrival of the Gold Trade Note, the gold element will
enter into the financial system via the trade payment arenas. Expect China to
make the introduction, which will kick the King Dollar in the
nuts. The kick will be done with a gold-tipped boot, the gold probably
re-hypothecated from stolen gold in London and delivered to Shanghai. The
Eastern nations will demand proper payment for shipments, which are honorably
supplied. The United States has deeply undermined the USDollar for its role in
banking, for its role in trade. Big profound changes are coming. The gold price
will in all likelihood experience some fritz on the billboard of prices. Expect
perhaps a different gold price in every global region, depending upon the
corruption and the honesty. The West will strive until its last breath to keep
the price down, while the East will strive with its every ounce of energy to
produce an honest price. The gold price will make movements to the $2500 level,
then $5000 level, then $8000 level, then $12,000 level. It is inevitable, like
the dawn after a long stormy night, like the rising tide.
GEOPOLITICAL REALITIES
The USDollar failure in the Middle East is a signpost for
every country to bail. The series of wars to defend the crippled toxic USD is a
signpost for every country to seek a better leading partner. Europe cannot
survive without the One Belt One Road cornucopia of $billion contracts and ample
projects. All trade goes through China and Russia, who lead the Eurasian Trade
Zone formation and provide its SCO security blanket, which will rival NATO.
An important factor, causing consternation to the propaganda artisans
in the West, is that Russia is a net debt-free nation while the US is bankrupt
and cannot save itself. Germany was bounced from Turkey, which now
is splintering off the NATO family of warmongers and heroin distributors.
Suddenly Turkey appears more influential than the western Nations, and might
soon rent the Russian Military some space at the giant Incirlik Airbase. The
Petro-Dollar failure gives Iran, Qatar, and Russia the primary hand. The USGovt
sanctions on Russia no longer mean anything. European nations are working to
restore relations commercially in defiance. The USGovt sanctions against Iran
backfired. It produced the Gold for Oil sale with India.
The Global Currency RESET is not far out. The pricing in financial
markets is dictated by derivatives solely for the purpose of keeping the Too Big
to Fail Banks solvent. The USFed’s hyper monetary inflation, better known
euphemistically as QE, is designed to keep these big broken banks liquid.
Without the derivatives of bond purchases, the big banks would all be in failure
mode like those in Spain and Italy. But the United States is the exceptional nation. The newly emerging
NatGas cartel will primarily deal in CNY, RUB, and EUR currencies, which is why
the United States is trying to force expensive NG sales onto Europe. The
Washington NeoCons are busy throwing hurdles in the way of Nord Stream 2, as
well as Turkish Stream. To use Saddam type of language, the mother of all
pipelines will be connecting Iran-Qatar-Iraq-Syria-Turkey to Europe. The King
Dollar and its reign of terror is coming to an end. That end is now visible. The
excitement will come when Gold enters the payment system picture, and the
enduring depression among gold investors will come to a welcomed
end.
HAT TRICK LETTER PROFITS IN THE CURRENT CRISIS.
No comments:
Post a Comment