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China "Attacks The Dollar" - Moves To Further Cement Renminbi Reserve Currency Status
In a surprising turn of events, today's biggest piece of news received a mere two paragraph blurb on Reuters, and was thoroughly ignored by the broader media. An announcement appeared shortly after midnight on the website of the People's Bank of China.
The statement, google translated as "Pragmatic and pioneering spirit to promote cross-border renminbi business cum on monitoring and analysis to a new level" is presented below:
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.
International Business Times provides further insight:
This is all part of China’s plan for the internationalization of its currency, which may, in the decades to come, threaten the global ‘market share’ of other currencies like the US dollar.
Previously, China also announced that bilateral trades with Russia and Malaysia will begin to be conducted with the yuan and the ruble and ringgit, respectively.
Other moves on the part of China to internationalize its currency include allowing foreign companies to issue yuan-denominated bonds and relaxing rules for foreign financial institutions to access the yuan.
Aside from the efforts of the Chinese government, fundamentals also point to the increasing international popularity of the Chinese currency.
China is already the leading trade partner with Australia and Japan. It’s also the leading or a large trade partner with many of its smaller neighbors. The purpose of having foreign currencies is to conduct foreign trade and investment, so the yuan is expected to become a more attractive currency for China’s trade partners, espeically as the government continues to relax restrictions.
The reason for this dramatic move may be found in what Stephen Roach wrote a few days ago in Project Syndicate:
In early March, China’s National People’s Congress will approve its 12th Five-Year Plan. This Plan is likely to go down in history as one of China’s boldest strategic initiatives.
In essence, it will change the character of China’s economic model – moving from the export- and investment-led structure of the past 30 years toward a pattern of growth that is driven increasingly by Chinese consumers. This shift will have profound implications for China, the rest of Asia, and the broader global economy.
Like the Fifth Five-Year Plan, which set the stage for the “reforms and opening up” of the late 1970’s, and the Ninth Five-Year Plan, which triggered the marketization of state-owned enterprises in the mid-1990’s, the upcoming Plan will force China to rethink the core value propositions of its economy. Premier Wen Jiabao laid the groundwork four years ago, when he first articulated the paradox of the “Four ‘Uns’” – an economy whose strength on the surface masked a structure that was increasingly “unstable, unbalanced, uncoordinated, and ultimately unsustainable.”
The Great Recession of 2008-2009 suggests that China can no longer afford to treat the Four Uns as theoretical conjecture. The post-crisis era is likely to be characterized by lasting aftershocks in the developed world – undermining the external demand upon which China has long relied. That leaves China’s government with little choice other than to turn to internal demand and tackle the Four Uns head on.
The 12th Five-Year Plan will do precisely that, focusing on major pro-consumption initiatives. China will begin to wean itself from the manufacturing model that has underpinned export- and investment-led growth. While the manufacturing approach served China well for 30 years, its dependence on capital-intensive, labor-saving productivity enhancement makes it incapable of absorbing the country’s massive labor surplus.
Instead, under the new Plan, China will adopt a more labor-intensive services model. It will, one hopes, provide a detailed blueprint for the development of large-scale transactions-intensive industries such as wholesale and retail trade, domestic transport and supply-chain logistics, health care, and leisure and hospitality.
Obviously, a reserve currency would be not only extremely useful, but quite critical in achieving the goal of China's conversion to an inwardly focused, middle-class reliant society. And even that would not guarantee a smooth transition. However, should China really be on a path to a step function in its evolution, the shocks to the system will be massive. Roach puts this diplomatically as follows:
But there is a catch: in shifting to a more consumption-led dynamic, China will reduce its surplus saving and have less left over to fund the ongoing saving deficits of countries like the US. The possibility of such an asymmetrical global rebalancing – with China taking the lead and the developed world dragging its feet – could be the key unintended consequence of China’s 12th Five-Year Plan.
A less diplomatic version implies that the relationship between China and the US would suffer a seismic shift in which the game theoretical model of Mutual Assured Destruction, and symbiotic monetary and fiscal policies, would no longer exist, allowing China to pursue its fate completely independent of any economic shocks that the increasingly distressed United States may be going through.
And confirming that the PBoC announcement is far more serious than the amount of airtime allotted to it by the mainstream media, is the just released article in Spiegel "China Attacked the Dollar" (google translated):
The Chinese central bank surprised with a spectacular announcement: The would-be superpower wants to handle their entire future foreign trade in yuan, not in dollars. Beijing shakes America's claim to represent the key currency - with serious consequences for the U.S..
The announcement was inconspicuous , but it has the potential, to permanently change the balance of power on the world currency market: China strengthens the international role of the yuan. All exporters and importers will, this year, be allowed to settle their business with their foreign partners in Yuan, the central bank said on Wednesday in Beijing.
This will respond to the growing importance of the yuan as a global reserve currency. "The market demand for cross-border use of the yuan rises," said the central bank. The PBoC had previously tested this plan by allowing 67 000 enterprises in 20 provinces to run their business abroad in yuan. The trade volume amounted to the equivalent of €56 billion.
Now the amount of yuan to be extended, it should be handled much more business in Chinese currency - and less in the U.S. Chinese companies trade at present often in dollars, they are thus dependent on the decisions of the U.S. Federal Reserve to pay on it in a rising oil price and will have pay higher transaction fees than necessary. That should change now.
Currently, the People's Republic can hardly take yuan out of the country and even that is monitored within the boundary of all legitimate capital flows. Chinese exporters have to change a large part of their euro, yen or dollars at a fixed rate revenue in yuan. Foreign companies wishing to do business in China must do so in Yuan, they can exchange their money in the People's Republic. Tourists are allowed a maximum of 20,000 yuan and exporting. Yuan an international market can not occur - and not on supply and demand-based exchange rate.
Needless to say, should the yuan be seen increasingly as a reserve currency, all of this, and virtually everything else is about to change.
The only question is whether or not the Yuan will cement its status at the top of the currency pyramid by allowing the backing of the currency with individual or a basket of commodities. If that were to happen, it would be the last nail in the coffin of the already terminally ill dollar.
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Q&A With Jim Chanos Part II: China's High-Rise Property House Of Cards
Damn you're transparent. Dumb, too. Bad combination. If I was paying you to post here, I'd want my money back.
Count me in as one much preferring to be on Chanos's side of the ledger here. The U.S. has pneumonia, but China has a more debilitating case of a viral syndrome, and it has a far more wicked demographic time bomb to deal with. Roll tape of Chinese 'Stealth' Fighter borrowed from Maverick & Goose's hanger.
The German press seems to pay more attention to this:
http://www.spiegel.de/wirtschaft/soziales/0,1518,748730,00.html
Down goes the Bernank down goes The Bernank i.e. fly like a butterfly sting like bee ;)
ola
wow long time no see
King $ likes this news: up .09%.
"Obviously, a reserve currency would be not only extremely useful, but quite critical in achieving the goal of China's conversion to an inwardly focused, middle-class reliant society. And even that would not guarantee a smooth transition."
Keynesnians are so conflicted about fiat money they cannot understsand the most compelling reason of all for a country to have its currency be used to settle international trade: it is the easiest way to gain the weath of those outside the internal economy via theft by dilution. When external parties hold your currency and you print more of it, you transfer their wealth to you without having to have contact with them in any way.
it is the easiest way to gain the weath of those outside the internal economy via theft by dilution. When external parties hold your currency and you print more of it, you transfer their wealth to you without having to have contact with them in any way.
Theft? Never heard of that.
Dilution by money printing? Sounds like new.
If I don't buy anything, do I qualify as a reserve currency?
"Them Chinese sumbitchez going down, FIRE ze Missiles"
http://www.youtube.com/watch?v=nZMwKPmsbWE
TD,
Thanks for the outstanding reporting...I learn more from ZH in one day than I learn in a year from reading the corporate press.
Last time I spent a year reading the corporate press, I ended up in rehab.
They let you out? Dam.
When did I say I got out?
I learn more from ZH in one day than I learn in a year from reading the corporate press.
Then stop wasting ZH resources posting your delusional drivel. More reading, less typing.
ZH Rules. My number 1 site that I keep to myself. Let the fools listen to MSM all day long. We get the real news here.
King $ is starting to choke: up only .086%
Just a hairball, chillout.
http://www.youtube.com/watch?v=qLAKE0X-k3M
Mao was one of the most evil men in history.
right behind the bernank!
Do you mean the Mau Mau, Obama's grandfather?
"...allowing China to pursue its fate completely independent of any economic shocks that the increasingly distressed United States may be going through..."
I somehow doubt that the US will allow China to do anything of the sort. The US 5-year plan no doubt involves finding ways to hurt China economically, provoke domestic unrest, and cut off their access to oil and other resources. This announcement just shows how high the stakes are, and how urgently this line of thinking is likely being pursued in Washington.
If you want to look for inflation, you won't find it in the United States, and the Fed is only responsible for its monetary policy. It is up to the central banks of emerging countries, confronted as they are with rising prices to react (+4.6% official figure in China, +9% in India, +6% in Brazil, +9.6% in Russia), either by allowing their currencies to appreciate, by tightening monetary policy, or both. To make this point even clearer, I am providing an updated graph, illustrating a phenomenon often discussed in these times, which is the utterly hypocritical statements made by Chinese officials, who only recently renewed their accusation that the Fed was following an overly easy monetary policy. Let's not forget that China, via its systematic manipulation of the dollar/yuan exchange rate when it requires Chinese businesses to sell it back dollars earned via exports in exchange for fresh new yuan, is indeed the one that is engaging in money creation via the printing of new money. It is perfectly understandable that China might be frustrated by the fact that the United States, via its 0% monetary policy, is not compensating its investments "correctly," but if you check out the changes in M2 money supply in the U.S., the eurozone and China, you will immediately see who is carrying out an easy money policy with its ensuing upward effect on commodity prices in the world. M2 in the USA, the eurozone and China. In 15 years, M2 has grown five-fold in China.
As you can see in this graph, China literally allowed its money supply to skyrocket, compared to that of the U.S. or the eurozone, with annual growth averaging +17.4% between 1996 and 2008, which compares to +7.1% in the eurozone and +6.3% in the United States. Above all, since the beginning of 2009, this divergence has actually widened, despite the Fed's QEs and 0% interest rates, since Chinese M2 has been growing at 26.6% per annum (!), versus +3.5% in the U.S. and +2.3% in the eurozone. http://seekingalpha.com/article/252124-enough-with-the-bernanke-bashing-...
Yeah, cuz Feral Reserve manipulation of the global reserve currency has NO impact outside of the borders of the USeless. Sure. It's all them other peoples faults.
Clearly it does. But, I think of China in the same way that I heard someone talk about the USSR some decades ago... shiny on the outside, but rusty on the inside. Crumbed from within. And seemingly overnight. While the "shiny versus rusty" analogy is bit a stretch - it's the character of the analogy that I am focusing on.
Crumbled within ?
A senior Chinese minister has warned that acute pollution and diminishing resources pose a huge risk to China's economic growth.
In an unusually blunt essay published this week, China's environment minister Zhou Shengxian set pollution concerns at the heart of China's next phase of economic development. His assessment comes ahead of the annual session of China's parliament, the National People's Congress, which opens on Saturday.
http://www.radioaustralia.net.au/asiapac/stories/201103/s3153445.htm
• Link •
Amazing Pictures, Pollution in China | ChinaHush
• Link •
Interview with Lu Guang, the photographer of “Pollution in China ...
oops. Yeah. Crumbled, not crumbed. LOL.
There was a Chinese cartoon I saw a few weeks back... It apparently got banned in China. The gist was an uprising against the political regime for the crimes against the people.
http://www.youtube.com/watch?v=m2qbWctMx9w
You never know what is disinformation these days. But, it think it is pretty safe to say that you can't manufacture at the prices China has been without screwing the people and the land in the process. With so many people living at the margins, it is a recipe for quite a mess. Of course, we are heading for our own mess sure enough... just a different flavor.
Thanks for the link.
They are already fucked. As the value of the yuan rises the manufacture complex get's monkey hammered. And now the unions are popping up. A total mess.
They have no social safety net, children working in coal mines, a nightmare. Forced abortions ect ...
The American Dream Is Alive and Well…In China
In fact, we heard that if U.S. immigration policies allowed it, 97% of the Chinese people would probably want to move to the United States.
So stop talking so disparagingly about the United States, we are told. We just can't believe it. You are destroying our dream for the future. Believing in America's great future as a signal for all of the rest of us is what has kept us Chinese going through many a dark day.
http://www.theglobalist.com/StoryId.aspx?StoryId=8832
"We heard"? If you actually knew any Chinese in China the majority would tell you that they wouldn't want to leave the country for any reason.
That statistic may of been true in the 50's but it's not the 50's anymore.
Great vid, thanks for sharing. For anyone who watches it, you can see the principal fears of the average Chinese person embodied in it: pollution will poison the young, the government will demolish your home. These are specific references to live issues in China today.
Interestingly, the communist party is portrayed as cats, while the people are portrayed as rabbits. They're not even the same species. This makes even more sense in the context of how the PRC was founded. At the time there were three forces in China: the Japanese occupying the north, the Nationalists on the coast, and the Communists were beat up and straggling to the interior. All through the country there were just masses of peasants getting stepped on by forces more powerful than them.
The communists harnessed those peasants and turned them into an army, but they didn't do it by instilling Leninist class consciousness into them. These were illiterate people who were more concerned with feeding themselves and their families. The communists tapped a deep well of hatred for the invading Japanese, and mobilised populist nationalism to get the villagers moving.
After the revolution was successful, the promise was that it would bring a better standard of living. For a lot of country folk that is still a long way off, and with inequality higher than ever it's getting harder and harder to keep them cooperative.
Look at the depiction of the rabbit: when the bad guys destroy his family, he gets angrier and angrier, until he leads an endless horde in to destroy the cats through sheer numbers. The final battle scene is scary: look at the incredible bloodlust that is implied, as these otherwise peaceful creatures turn rabid. This is what the Communists used to get into power, and this is what could turn against them if things get too bad. No wonder they're trying to change people into middle-class consumer drones. Not only do they get to stop a revolt happening now, but they remove the cultural basis for future ones as well.
Break the peg. No more inflation, what are they waiting for ..... Oh ya, that manufacturing complex thing'y built upon suppressed rates & the banks / PBoC who borrowed yuan at suppressed rates ...
Given your prolific copy-paste of articles, you'd think you'd have read that the Yuan's peg is in lieu of being tradable. But, of course, nothing in a complex system is quite as easy as "depegging".
And I'm not arguing that China doesn't have massive unsustainable bubbles. Just the facile currency peg/Feral Reserve not the/a problem B.S.
Damned if you aren't desperate to explain away reality.
The dollar is the worlds reserve currency, therefore it will always be the world's reserve currency. I can't see how it would work any other way, therefore it can not work any other way.
A piece of paper backed by guns, cannot be a world reserve currency.
organized capital has been moving around the world, spain, north europe, UK, USA, China, financiers are loyal to $, not nations
Spot on SS. The M2 growth disparity seems much better understood among the EM bankers and merchants than among the US financial elites. Even our dreaded PK seems to miss this point. Not to mention that besides skyrocketing M2 China has the velocity to make it matter. The next time someone wants to blame only the Bernank for starving the MENA poor they should say Hu? Regards CI
Bingo •••••
Of course, quite exactly HOW printing yuan translates into rising food prices in Egypt isn't mentioned. Oh well, keep on bashing. Logic is for sissies anyway, right Herr Goebles?
How does Ben's printing matter. Central Bankers control the host countries currency, move the peg.
Answer my question first, smart guy.
What ??? Now answer my question
ANALYSIS - China the wild card for commodity prices(Reuters) - A strengthening global economy and growth in demand are likely to keep commodity prices high in coming months, but there is a risk China could slam on the monetary brakes and trigger a reversal.
• • • • • Ludwig von Mises Institute • • • • •
How China's monetary policy drives world commodity prices
How monetary expansion and the rigid exchange rate drive commodity prices
Based on the huge trade surplus with the United States, which stood at $114 bill in 2005, most analysts have concluded that the current rate of exchange of 8.017 yuan to the US dollar is far too high. However, what matters for the currency rate of exchange is the pace of money expansion relative to real economic growth — not the state of the trade account.
After falling to negative 1.2% in March 2001 the yearly rate of growth of the central bank balance sheet (monetary pumping) relative to real economic activity climbed to 28.2% in September 2005. In February this year the yearly rate of growth of the relative pumping stood at 22.1%.
In contrast, the yearly rate of growth of the Fed's balance sheet in relation to real economic activity fell from 11.6% in September 2001 to 0.9% in March this year.
http://mises.org/daily/2134
Pin drop •
Nicely done. (golf clap)Regards, CI
Just keep in mind that the mises article is dated: Tuesday, May 02, 2006.
Same currency games being played , today, no ???
Similar yes, but some of those charts need to be updated as well as the Fed's unprecedented holdings, no?
"In contrast, the yearly rate of growth of the Fed's balance sheet in relation to real economic activity fell from 11.6% in September 2001 to 0.9% in March this year."
- I wonder what the current numbers are........
Not sure, I looked around the web, nothing. I'll send them an email in a.m. It would be nice to get an update, your right.
M2 growing in the US and the EU is about 3% per year. China's M2 expansion running at 25%.
Your right , it's gotten worse.
Spalding no need to get defensive, I am wondering what the current number is for 'the yearly rate of growth of the Fed's balance sheet in relation to real economic activity' as a %.
Sorry.
With the shadow banking mess that's a good question. That was a massive growth engine in it's self.
No problemo, but one more quick thought. Correct me if I am wrong about your position on gold/silver, but I believe you are not a fan, yes, no?
If not, wouldn't China's Monetary growth be bullish for gold/silver as the Chinese seek an inflation hedge?
If I had $500,000 cash, I would have 10 percent in gold / silver.
But yes, I think it's a bubble. Like every other trade ( hedge funds trade silver / gold • traders / etf - paper ) And the fact it's built upon derivative paper, miners doing two step with bullion banks • hedging
What goes up ..... Not sure what the true floor is. Derivative paper has had a big impact on price, lots of bets being put forth.
Short of a large Taleb Black Swan event, I have been wondering myself about the exit strategy/time. Maybe we disagree on how far we are into the bubble/bull-run, but I do wonder this early on.
In your opinion, what about a comex default? or the idea that this run still has far to go because of the lack of players involved? or the amount of money central banks world wide are printing? (all in terms of possibly pushing the pms higher.)
and lastly if you have the patience, what are your thoughts on Mr. Doom himself, Marc Faber?
.
You're about 10 years late in your forecast. SARS was the first shot (right after 2000 market crash), a disease genetically engineered to kill those billions of pesky (oil sucking) Asians. So says the former Forbes Asia bureau chief out of Japan. Supposedly, the CFR/FRNgangsters were warned of MAD. All of these color revolutions are C!A work. Long standing support for the dalai lama (human rights? puh-leeze).
Guess what? It aint working. Yes, the Chinese banks are stuffed with NPLs but they're a sensible part of the government's toolkit (unlike the unbridled fascist corruption here)and are always getting recapitalized. Besides, what these fools are pointing out is that the Chinese gov has also opened the fiscal and monetary spigot (which in Amerika is called "the economy") in a bid for keeping gdp growth going.....BUT unlike the US gov, the Chinese (Russia, the SCO countries and maybe Europe) have real gold (the true amount is not published) to BACK THE YUAN WITH GOLD.
Kaput ist dollar!
What the hell are you gonna do about it fascist FRN lovers? Nuke'em?
Bring it on!
I somehow doubt that the US will allow China to do anything of the sort. The US 5-year plan no doubt involves finding ways to hurt China economically, provoke domestic unrest, and cut off their access to oil and other resources.
What serious delusion.
If America goes up against China it's not just China, it's China, Russia, India, Iran, and the list is getting longer.
+ another 1oz.
Does that mean China will export their rampant inflation back to the world?
do you all really think they built their huge empty cities for naught? you american slaves have to live somewhere! i'm in canada, so i'm safe! right?
No...as America goes Canada goes. Canadians should be happy we don't assimilate them. Their
assets do look delicious and I hear New Brunswick farmland is quite
productive.
Your Bogeyman...
Fucking eh
ask PM Harper, it's less than a month since he & Obama shook hands on the latest "agreement" inching closer to a North American Union. . .
http://www.thenewamerican.com/index.php/world-mainmenu-26/north-america-...
'sides, aren't you opening the west coast to chinese property accumulations? *cough* Vancouver BC
'Assimilate'? Nah, then the US would actually be responsible for them. Better off keep those canucks as lap dogs who will do tricks for biscuits. Besides they already spend their lives doing everything they can to be just like Americans anyway, so no need.
Did you hear the about the electric Chinaman? Who fuckie wall sockie?
According to Barney Frank, if the main stream media doesn't pick up a story, the content of which (fed audit) was personally manipulated by him, there's no real news there. Since the Feds bailouts are no news, this must also be no news. Move along to the real important news- Lindsey Lohan & Charlie Sheen.
Did you know that Charlie Sheen is Fwanks' cousin?
Neither did I.
Charlie Sheen's Twitter following: 500k people in first 24 hours. 1.1M as of now, his second day on Twitter.
Zero Hedge's Twitter following: 20k
Twitter is more than a social tool okay?:
http://www.utepprospector.com/entertainment/twitter-becoming-more-than-a-social-tool-1.2039190
Follow me on Twitter here.
Sounds more like 1.1M social tools.
Well I can understand this and it boils down to Americas need to be "diverse"
What Americans don't understand is that many countries don't want to deal with a black man, or a woman for that matter. Do you see how Islamic nations regard women? Do you really think the Chinese, or any Islamic nation, wants to deal with Hillary Clinton, or Janet Napalitano (granted it might be a guy)? The Chinese don't like black people either. I can see why the world doesn't take us seriously.
There are also too many cultural differences to unite a country and even the Europeans have accepted that multiculturalism has been an epic failure. It simply does not work.
In addition look at how our leadership presents itself in front of crisis; flippant, slow, incompetant, unresolved...I mean it is a shame what this country has come to.
Chinese women like black men.
Dude, if I were you I'd wonder how many people take my posts seriously.
he's correct; multiculturalism is a gigantic failure. Nobody likes black people either. And, why should they?
Thanks bro. I will spend more time wondering.
because the world took dubya seriously, right.
argh
http://www.youtube.com/watch?v=iefUQwgYu5k
As long as the US still controls the distribution of oil, China has no choice but has to play by the rules designed by Washington.
'control the distribution of oil'
Christ, you see how full Cushing is?
china and russia signed an agreement to use the yuan in the purchase of russian oil!
We (the USA) do this controlling with our dollar, not with our army. As we loss the value of our dollar, so we loss our control. The US has little to sell except food (thank God). It's this lack of an export that makes lossing the dollar so bad. Can you imagine a time when no one outside this country wants our money? Now the world uses our dollar for trading, and thus wants USDs. Big Ben is not helping to keep the USD's value, and China is stepping in to keep it's wealth (not in dollars).
From portland, ore to Pismo Beach Calf. crappy pothole roads. Great job government is doing. Mcdonalds is my free wifi home now. Good lord there are a lot of poor people. Seems like hyper inflation has already begun. I have nothing left to lose here and am heading back to germany after spending most my life here.
As i travel and live vicariously now i notice how poor we really are. Poor in spirit, poor in heart and the churches and religions do us little good. we have been brainwashed to live in our heads with our desires. Too bad for us, the smartest may not be the best off. I wish you all the best, will no longer post.
Zerohedge, Tyler Durden, Thank you ever so much. You may have saved many lives because i learned here what was coming and have warned many, given many a silver, am shit poor but still have a better path than most. And i have freely given most of it. But the lives saved means more to me than having. Soon i will give away the car as well, haha. What a wacky world. Bye
I wish you all the best. I hope you find opportunity in Germany, or where ever you wind up.
Yes, many come to America hoping for better things, some things are better, but the moral bankruptcy eventually overshadows them.
I fear Germany is headed in the same direction, just not as far gone as America.
Merehuman -
You will be missed here - please know that.
the experiences shared and wisdom gained will always be with you merehuman, wherever you find yourself in the world.
many here wish you well, take care down the road. . .
Good bye friend.
Good luck, friend. I gave away silver here and there and thought of you each time I did so.
First poster should be shot for wasting the:
'economic warfare, bitchez!'
chance.
The US has a weak foreign policy and a weak president. Strategically, this is the best time to knock US out of the top stop. Weak economy, weak employment, weak foreign policy, military stretched too thin and exhausted...frankly we are ripe for a KO punch and it can be done without firing a shot.
Ya think? With Obama directing DHS to frisk 2 year olds and grannies getting off a train there's plenty of opportunity for others to maneuver into our weak sides. Security theater makes for votes alone. (After the three reported terrorist events early in Obama's presidency, he can't afford a fourth.)
Our economy and world standing are just two symptoms of a larger issue with the US: Lack of accountability. Bernank accountable... to whom? Geithner....I'll pay the back taxes later. Banksters....City and NY banks suported Libya and K-Daffy for years after Lockerbie was tied down to them.
You know somethin is coming down the pipe from China and it's got our name on it. Then US gov nationalizes 401ks here to cover their shorts. Either way, it's going to get ugly before long.
Back to Charlie Sheen and his iPad2
Obama / Bernanke should be impeached!
whatever happened to oBLAHmas' mother in law who had moved into the white house? where is bo bo the dog? notice bo bo the dog and the bernank share the same initials? coincidence? i think not!
Bo's got her bent over and while he's licking Ben's balls.
Can't people just stop buying Chinese products? I stopped long ago cause, really, the products are trash, but also because I don't want to support their slave worker system. And nobody mentions all the companies doing business with them are participating in that slavery.
Here is a list:
http://www.cnn.com/CNN/Programs/lou.dobbs.tonight/popups/exporting.ameri...
I doubt any of them would stop because they can make a buck easier over there and not give a shit about OSHA or unions or lawyers or law or justice or morality. The U.S. isn't just complicit they are enablers.
Switch from a Chinese product? The hell if I'm giving up my ipown! I don't even wanna know where 'droid capable device is made. And don't say Motorola - Chicago's worse than China!
Wow, so you build your own computer motherboards/hdd's/memory/video chips/cases/monitors/keyboards/mice to post on the Hedge? I'm impressed...
Those are also made in Taiwan, Korea, Japan, etc. I was trying to suggest that with one, the consumer driven economy, you get the other, the economy of the oppressed; one feeds the other. People do have a choice of what to buy.
Also there is great hypocrisy about Chinese/US relations and economies. There used to be a Made In The USA commercial - now the Made In The USA people see is on weapons and instruments of war yet is that something Americans discuss? Perhaps China sees the U.S. as the financial and military monster trying to manipulate the world. Why are U.S. interests anyone else's worry?
People want and need boogeymen. China is an easy monster to scare the kiddies. The truth is their people are the same as anywhere.
Google chinese food product codes to be a smart shopper. We dont test the shit they send over and most of their seafood they ship us is contaminated.
ya, those Chinese don't have the Monsanto'd FDA looking out for them, poor things.
This is nothing more than a leverage move to get a more powerfull seat at the one world currencey table..SDR'S will be the next reserve currencey backed by a basket of alot of worthless paper from around the world along with maybe 10% Gold..
The commodity basket will also include the iPad, iPod, iPhone...
now that's leverage
That's what I'm thinking.
It's a cosmic game of chicken over who will rule the next WRC, West or East.
West wants fiat again, East favors commodity backed.
It's about what'll be in the SDR basket and the exchange rates. They're "negotiating".
Rickards suggested Russia and China could already team up to form WRC, and game over
Except it still takes time to make happen. But it won't take time for people to run from the USD.
Perhaps you're right, maybe it will be SDR.
Yuan doesn't have to become WRC for America to collapse. Dollar losing WRC status will do it.
Dollar is 65 percent of world reserves.
It will be 50 percent of the sdr.
We will be fine.
I`m not taking any effing SDR. You NWO creep.
the SDR has been in place for decades, used for decades... it is nothing new. pre NWO public discussions any way.
New item in your series of interest:
SDR Valuation as of Mar 02, 2011 Disclaimer: The International Monetary Fund makes no warranties, express or implied, regarding these tables or the performance of this site. The Fund shall not be liable for any losses or damages incurred in connection with this site.
http://www.imf.org/external/np/fin/data/rms_sdrv.aspx?Month=03&Day=02&Year=2011&submit=Submit
CNY a challenger for the fiat reserve currency? Maybe so, but talk about an ugly contest. And if you think mass murderer Mao's puss can turn milk sour, be thankful they didn't slap an image of Jiang Zemin and his birth control glasses on yuan notes. Nightmare fuel.
Lmfao!
Birth control glasses!
I had a pair of those in 7th.grade!
Anybody who hates the US Dollar should be terrified of the Yuan.
We print the Dollar to prevent 150 million people from going hungry.
They print the Yuan to prevent 750 million people from going hungry.
I don't think either party prints money to keep people from going hungry. At least, not YET.
Printing money produces food? Next thing you'll tell me, Bernutty can turn tungsten into gold.
If a country can convince other contries to give them wealth while maintaining a reasonably stable currency, then yes, printed money can prevent a depression.
Pull up a chart of EU, Chinese, Japanese, or US M2 over the past 10 years - things have not completely unwound, people (en masse) are not hungry, yet printing continues (unhindered).
Everything is manageable until the day that it is not. Seems like that day is getting closer and closer.
No kidding!
Here is what I said in the local paper awhile back:
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Wednesday, August 5, 2009
Guest column: Be careful what you ask for when dealing with China, economy
By the time this is printed President Obama and his staff will have met in Washington, D.C., with the leaders of China. Many things were on the agenda, but economic issues were at the forefront of the discussions. For years, some in business and the U.S. government have accused the Chinese of manipulating their currency. And the evidence is overwhelming that they have indeed been keeping their currency, the Yuan, artificially low vs. the U.S. dollar. This has the effect of making their exports to this country low priced. This has been a big booster of profits for those companies that import Chinese goods into this country, and American companys like Walmart, and Big Five Sporting goods have profited. And most American consumers of these goods have not minded either.
How did China go about keeping its currency artificially low? As Chinese companies sold their goods for U.S. dollars, the Chinese government printed Yuan and bought dollars in the marketplace. But they didn't just let those U.S. dollars sit in a pile. They used those dollars to buy U.S. government treasury bills. In other words, they loaned those dollars back to our U.S. government. This has had the effect of holding interest rates artificially low in this country for years. Usually when a government borrows money by selling treasury bills, it has the effect of causing long-term interest rates to rise, since they are competing for money with the marketplace in general.
And what of the effect of all these cheap Chinese goods coming into this country? Inflation rates have been kept artificially low. These low inflation rates have been all the excuse our Federal Reserve has needed to keep short-term interest rates low. So for years, interest rates have been artificially low in this country, and the effect has spread around the world. In fact, our stock markets, bond markets and housing markets have become addicted to low interest rates. We now think that if we have low interest rates all of our economic ills will be cured.
So what is the official position of our government concerning China's manipulation of its currency? Our government, (this administration as well as the former administration) has repeatedly scolded the Chinese for keeping their currency artificially low. So now in their talks it appears that they intend to try to pressure the Chinese government to stop the manipulation! This is a great populist talking point, since we have to have someone to blame for letting us all get so deep in debt over the past decade. But, what happens if they do as we want them to. Let's say they stop buying up U.S. dollars. That makes the dollar worth less, and makes our imports cost more. That includes all the oil that we import. Prices go up. Inflation goes up. So interest rates go up. (Who wants to loan money at less than the inflation rate?) And this may happen at a time when the world is more populated than ever, and natural resources are in greater demand than ever before. So what can they do with that big pile of dollars that they own, (that we owe them)? They can go around the world and buy up mines, and oil production and steel mills. This is precisely what they have been doing for years. They will outbid us with our own money.
I have no doubt that the Chinese government at some point will leave the U.S. dollar to its own devices. It will probably happen gradually, since they have such huge savings invested in the dollar. The only benefit for us, if you can call it that, is that inflation will make our existing debts that much smaller. We will pay them back in "smaller" dollars. In the mean time (pun intended) our economy will have to endure a long spell of frugality as we all save so we can have money to invest in producing those things that we want to use and to sell to other countries. But inflation is on the way, and inflation is hard on savings if those saving are not in something that holds its value. So we need to be careful of what we ask for. Or at least understand what it is that we ask for.
http://ghickeyblog.blogspot.com
All this is true.
We let the game go on so long that readjustment may cause a little pain.
The alternative is the continued destruction and hollowing out of our real economy.
We cant continue to let the imbalances build.
If china refuses to end the peg then we have to force the issue now.
From portland, ore to Pismo Beach Calf. crappy pothole roads.
What utter bullshit. The only thing our so called stimulus spending did was fix roads at exorbitant "prevailing wage" union wages. There's highway projects all over Oregon retard. Good riddance to you, enjoy socialist Europe & take a few of your hippy doper friends with you please, Portland OR is a cesspool filled with your kind of turd. (no offence intended TF)
America haters abound on the internet. Many of you brainwashed moronic pricks owe your freedom & lives to the Americans who died in Europe & Asia fighting fascists & communists.
America needs to throw up 40% tariffs on Chinese communist goods and submit a bill to Asia & Europe for the defense of your pussified countries over the last 70 years.
Thank you for your thoughts, Billow Wryly.
ahhhahhahahahhhhh, dejunked for subtle sniggers.
way to show some patriotism for those global banksters literally in the midst of being fleeced!
Stockholm syndrome much?
I grew up in Oregon and know what you mean! Used to be great place. I never moved back due to all the new neighbors. No pot holes when I was there.
Tariffs pass the cost to consumers, we'd pay anyway. Trump is off the mark.
Trade wars would ensue like Great Depression, not be good for anybody.
We still have the highest corporate tax in the world, not good.
Why don't we get rid of the Fed, change our banking laws, and become the new Switzerland and offshore banking capital of the world so investors and countries can hide their money here.
I still live in Oregon. Have for 35 years. Great place to live. Good roads. No potholes where I live. Little trash on the roads. No popcans beside the roads. I don't have to pump my own gas. And friendly people.
Too many neighbors lately tho....
gh
It's a start.
Next China weens off UST holdings...
Then a war.
6-12 mth time frame.
How in the hell can the Yuan be the reserve currency of thworld! First off they have a neutron bomb real estate bubble when explodes will plunge the wrold into a dperession. Second have you seen their rate of inflation?! All these rate hike aight doing shit. China's rate of inflation is exploding faster then road runner. They will probably have hyperinflation 18 months from now. Third they are a communist government that tortures it any dissent,disarm their people.Plus they will never break the dollar peg Now I am not saying the dollar will survive because anybody with half a brain knows the dollars day of doom is coming 5-15 years from now. However China has a shitload of economic problems if blown up could sent China into civil war and the world into a hyper depression. China is over hyped just like Japan was in the 80s. The euro is doom,the yuan is doom,the dollar is doom. So I do not see any good replacements for the dollar over then a basket of currencies. China is a paranoid government who fears dissent and this will lead to its end.
It won't...what china is doing is kinda going into an economic war with the US. good luck to them. Next they're are going to sell a massive chunk of UST's soon.
what we should be worried about is how this will play out geopolitically.
China doesn't inovate or have a massive consumption market, it may get there in 5-10yrs and surpass the US...but for now forget it.
Dumb. America underreports inflation. Look into weighting, hedonics, and substitution. Also America represses opinions through the propaganda model, look it up. China does it through censorship. America's method is much more advanced.
It's game over for America.
East and West are fighting over WRC.
Benocide floods the globe with USD, they're flipping Bernanke and the USD the bird.
Must be how they 'negotiate' things for what's going to be in the SDR basket
West (pricks) want fiat, while I think China wants PM/partial backed.
If China has more PM than they have let on, and more time, they could make a go of it.
Either way, this is another direct hit and people will flee the USD scene
I would love to see this all end with the.chinese removing the dollar peg. Ultimately we and the rest of the world will be better off in the long run with trade flows better balanced.
Looks like Ben's dollar bombs are working.
Kung Pao Currency becoming more mainstream ? Uhh..not unless they back it with something like precious metals. The first fiat to back its paper with something wins this crooked game in my humble opinion.
Or one can just buy PMs. I know, a new and novel idea.
I agree. I think China may have more metal than we think.
.
China talking tough:
http://articles.timesofindia.indiatimes.com/2011-02-12/china/28545343_1_china-countries-communist-party#ixzz1Dngi7fee
Quote:
"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.
The Chinese have spent the last 30 years recreating the industrial reolution and now they want to become A NON-Producing bullshit economy like the US and Europe.
Hey, losers, welcome to the party.
Make yourself some big commercial banks, extemd a lot out leverage and loans and completely hyperinflate and blow the fuck up.
And even better, make a currency bases
D on resources like gold,oil and silver and copper so when your deflate, you can't scare up real money.
That way the Chinese can recreate 1929 crash all over again TOO.
These guys never learn from any last mistakes including ecodisasters, hyperinflation and mega bubbles. I' m microwaving my popcorn for this show.
The west has this fantasy that China is in full control. Its not. It has no centralized tax system and the bubbles are allblown up by local politicians looking for graft. 50% of the economy is based on a big scam. The rest is slave labor.
This is going to be rich watching China go tits up in hyperinflation to super depression.
Oil is the lubricant of currency and global economic wealth.
Interesting gamesmanship in the ME currently as the Globalists, after making the West and Europe primarily dependent on the region’s oil, take the crack pipe away from the addict whores until they accept the pimp’s new terms.
No oil for Euros. No oil for USD. No oil at all unless you accept our terms on this new currency.
China may have Russia for petro but Russia now has to worry about a Europe ready to be ignited with false flag terrorism to be attributed to the latest ethnic minority that has infiltrated their way of life and that needs to be demonized, forcibly removed and repatriated.
Sound familar? It will be the same game plan as the 1930’s with the same pyramid demons that were responsible for the last genocide at the controls unless they are stopped.
Other big losers here will most certainly be the Brits who, prior to this controlled currency demolition, will have had money supported by petroleum purchases on the oil bourses. This will make the GBP significantly more irrelevant and toxic than it already is...leaving a large, impoverished and imprisoned serf class ruled by a miniscule elite and we know how well that ended for the Scots and the Irish.
This won’t be about traditional armies clashing this time. Once the currency war is settled, the chips will be counted and the sheeple will be trained to accept resource scarcity, with the rarest remaining as liberty. After that, the focus will be herd reduction.
This is what they do and have attempted to do over several world wars. Only now have they developed an extended global reach.
The answer to this problem is not to accept their solution, a one world currency and a global central bank. Another larger central bank is not the answer.
The people have to put the bank back in bankruptcy and see all these private central banking shareholders pay for once.
No Banks. No Wars.
V
America Under Attack by Treasnous Bankers...
http://thehardrightedge.com/america-under-attack-by-treasonous-bankers/
for pragmatism and ambition, china wants its currency central. the usa has so mismanaged (by design) its own currency that the chinese have no practical alternative....however, it's not just china - major powers excluding the usa and britain agreed in 2010 to dump the usd as reserve currency...the usa's exorbitant privilege is coming to an end this year....the handwriting has been on the wall in case you haven't noticed....
the inflation which so many fucktarded morons have denied for so long is about to come roaring like a tsunami to american shores.....the usa is in economic shambles courtesy of its legions of highly educated managers who will make the great depression appear like an economic boom....and still the assholes in washington want to spend trillions on wars of imperial aggression....
we will see martial law this year - again one of the aims of the current planned economic holocaust....
america so richly deserves its fate as much from its evil deeds over seas as from its people being dumber than a pig's ass.....
And.. The narrative played on.
I read none of the other comments so forgive me if this has been said before but the only reason China would state this goal is political, which yes, I know is almost everything. But they can only pull of being a world reserve if they are willing to be transparent in their currency movement and their data is way more manipulated than our obviously manipulated data.
What I'm saying, long term is, this is our future ally in the upcoming "big one". We need each other. Anyone who buys into them buys into us. They are not at war with us. They want to convince the world they are at war with us but the previous administrations have made friends and they all know why. If China wants to pull off their forward prcing lies they will need consumer confidence to make it happen.
And no one consumes like us.
I doubt China is any more "willing to be transparent in their currency movement" than the U.S. is. Why does the Fed have to hide its gold swap information?
I think all these currencies are going to be faded simultaneously because people are no longer going to be fooled by monetary puppeteers. That primarily means resource rich countries that won't want faith-based-paper for real world goods.
Being the reserve currency may be somewhat overrated. Mostly it seems to mean that everyone tries to undervalue their local currency with respect to yours in order to boost their exports. This may tend to lower interest rates for government bonds, leading to a lot of wasteful government spending. But it kills manufacturing and exports.
I cannot blame the Chinese for wanting to be less dependent on dollars. Actually, I try to exchange my dollars for other things as quickly as possible. But it sounds as if they have a ways to go. I think that they would need to keep inflation under control, make it possible for yuan to freely move in and out of the country, and generally give people reasons to prefer holding yuan rather than dollars. (The Fed may give them a bit of help in that area.)
Also, I think that India will eventually give China a run for their money (pun intended). I think that India will eventually be a larger economy than China and in many ways India is already ahead of China in the areas of freedom and openness.
+1
[relaxing rules for foreign financial institutions to access the yuan]
[China's conversion to an inwardly focused, middle-class reliant]
parasite organized capital is moving to the next host?
Bingo.
1. More fiat currency from a more opaque institution like China isn't going to solve the economic imbalances in this world.
2. This will end badly for the American people.
3. It seems that globalization is now officially a cancer to society rather than a benefit.
4. It's time we really start to overthrow the system before the system drives us all to dire straits.
5. The need for a global power or reserve currency is becoming less important in a well connected world.
http://www.huffingtonpost.com/2011/03/03/gerhard-gribkowsky-in-jail-corr...
Corruption is the word of the nascent millenium.
This is what Rajat Gupta wrote to his Alum soon after SEC charges. Entire EMAIL transcript
http://dawnwires.com/investment-news/email-trail-of-mr-rajat-gupta-mckinsey/
It's a small inter-connected world at the very top. Who woulda thought Mubarak would've handed all of his money to Israel?
http://canucwhatic.blogspot.com/
Well played by China.
What a load of Rubbish. 3 years ago the same talk was about the Euro replacing the US Dollar. The more things change, the more they stay the same. Long the Dollar.
...and germany attacks the world with its new war minister former secret police gdr official
here to be seen in his gdr uniform - title saying: one step closer!PW-Buergerkriegsminister.jpg
now chancelor merkel has her team back together as she also is a former gdr official having spent a lot of her time as leader of the fdj (free german youth organisation under the gdr regime) though nobody in germany seems to care...after all old gdr politicians must be better then somebody faking his phd