China's Official Press Agency Calls For New Reserve Currency, And New World Order

Tyler Durden's picture

We assume it is a coincidence that on the day in which we demonstrate China's relentless appetite for gold, driven by what we and many others believe is the country's desire to have a call option on a gold-backed reserve currency when the time comes, just posted in China's official press agency, Xinhua, is an op-ed by writer Liu Chang in which he decries the "US fiscal failure which warrants a de-Americanized world" and flatly states that the world should consider a new reserve currency "that is to be created to replace the dominant U.S. dollar, so that the international community could permanently stay away from the spillover of the intensifying domestic political turmoil in the United States."

Of course, if China were serious, and if the world were to voluntarily engage in such a (r)evolutionary reserve currency transition, then all Magic Money Tree theories that the only thing better than near infinite debt is beyond infinite debt, would promptly be relegated to the historic dust heap of idiotic theories where they belong.

Some of China's (which as a reminder is the single largest offshore holder of US Treasury paper, and the second largest of all only second naturally to the Federal Reserve whose $85 billion in monthly monetizing "flow" is what is keeping rates from exploding higher) thoughts as captured in the Xinhua Op-ed:

  • Reform of the world’s financial system should include the introduction of a new internatonal reserve currency to replace the U.S. dollar
  • The international community could thus permanently stay away from the spillover of intensifying domestic political turmoil in the U.S.
  • Fiscal impasse in the U.S. is a good time for “befuddled world” to start considering building a “de-Americanized world
  • Impasse has left many nations’ dollar assets in jeopardy and the international community agonized
  • Other cornerstones should be laid to underpin a de-Americanized world, including respect for sovereignty, recognizing authority of UN in handling global hotspot issues and giving developing and emerging market economies more say in major international financial institutions
  • Purpose of such changes is not to “completely toss the United States aside,” rather to encourage Washington to play a much more constructive role in addressing global affairs

Of course, if and when the day comes that the USD is no longer the reserve currency, kiss America's superpower, or any power, status, which is now based purely on the USD's reserve currency status, and the ability to fund half the US budget deficit with debt promptly monetized by the Fed, goodbye.

Finally, as a reminder...

From Xinhua:

U.S. fiscal failure warrants a de-Americanized world

As U.S. politicians of both political parties are still shuffling back and forth between the White House and the Capitol Hill without striking a viable deal to bring normality to the body politic they brag about, it is perhaps a good time for the befuddled world to start considering building a de-Americanized world.

Emerging from the bloodshed of the Second World War as the world's most powerful nation, the United States has since then been trying to build a global empire by imposing a postwar world order, fueling recovery in Europe, and encouraging regime-change in nations that it deems hardly Washington-friendly.

With its seemingly unrivaled economic and military might, the United States has declared that it has vital national interests to protect in nearly every corner of the globe, and been habituated to meddling in the business of other countries and regions far away from its shores.

Meanwhile, the U.S. government has gone to all lengths to appear before the world as the one that claims the moral high ground, yet covertly doing things that are as audacious as torturing prisoners of war, slaying civilians in drone attacks, and spying on world leaders.

Under what is known as the Pax-Americana, we fail to see a world where the United States is helping to defuse violence and conflicts, reduce poor and displaced population, and bring about real, lasting peace.

Moreover, instead of honoring its duties as a responsible leading power, a self-serving Washington has abused its superpower status and introduced even more chaos into the world by shifting financial risks overseas, instigating regional tensions amid territorial disputes, and fighting unwarranted wars under the cover of outright lies.

As a result, the world is still crawling its way out of an economic disaster thanks to the voracious Wall Street elites, while bombings and killings have become virtually daily routines in Iraq years after Washington claimed it has liberated its people from tyrannical rule.

Most recently, the cyclical stagnation in Washington for a viable bipartisan solution over a federal budget and an approval for raising debt ceiling has again left many nations' tremendous dollar assets in jeopardy and the international community highly agonized.

Such alarming days when the destinies of others are in the hands of a hypocritical nation have to be terminated, and a new world order should be put in place, according to which all nations, big or small, poor or rich, can have their key interests respected and protected on an equal footing.

To that end, several corner stones should be laid to underpin a de-Americanized world.

For starters, all nations need to hew to the basic principles of the international law, including respect for sovereignty, and keeping hands off domestic affairs of others.

Furthermore, the authority of the United Nations in handling global hotspot issues has to be recognized. That means no one has the right to wage any form of military action against others without a UN mandate.

Apart from that, the world's financial system also has to embrace some substantial reforms.

The developing and emerging market economies need to have more say in major international financial institutions including the World Bank and the International Monetary Fund, so that they could better reflect the transformations of the global economic and political landscape.

What may also be included as a key part of an effective reform is the introduction of a new international reserve currency that is to be created to replace the dominant U.S. dollar, so that the international community could permanently stay away from the spillover of the intensifying domestic political turmoil in the United States.

Of course, the purpose of promoting these changes is not to completely toss the United States aside, which is also impossible. Rather, it is to encourage Washington to play a much more constructive role in addressing global affairs.

And among all options, it is suggested that the beltway politicians first begin with ending the pernicious impasse.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
GVB's picture

Here's your black swan event. There you have it...

remain calm's picture

Keep printing Yellin, you dumb fucking bitch.

imapopulistnow's picture

Keep up the ideology wars you idiotic politicians.

LawsofPhysics's picture

Will China open their books and let the Yuan appreciate?  LMFAO!

Bring it!!  I will happily accept gold for my soybeans then.  Sounds great, bring it on!

NoDebt's picture

..... says the country that keeps it currency pegged in a tight range to the dollar.

Your time is not yet, China.  Maybe someday.  But not today.

LawsofPhysics's picture

It would that the U.S. has indeed caught China in terms of coruption and doublespeak.  So there's that I guess.

Arius's picture

"the purpose is not the toss US aside which is also impossible"


Glad you know that ... you chinese fuck!

THis is America!


Where are the leaders like Ronald Regan and Maggie Thatcher now that we need them?  they cared about the individuals and their feelings ...

roadhazard's picture

Ronald Reagan?????? heh

economics9698's picture

Reagan set the record for deficit spending...until Obama.

Element's picture

Obama's first budget passed in late April 2009 (seven months after Lehmans). So the humungous deficit blow-out, post-Lehman's, went on the books during the FY of Bush's final budget, so that very first trillion $$$ deficit was Bush's.


TwoShortPlanks's picture

That would be Master to you in, "glad to know that ... my chinese master"

Let's start taking reality ino the equation from now on, yeah?!

Realities such as the TBTF Banks migrating Gold Reserves and COMEX Gold across into China to set-up their next 50+ years of business.


Arius's picture

okay TSP - i do respect your opinion ....

TwoShortPlanks's picture

No offence intended...and likewise on opinion...I'm just Trollin around.

But-But-But, would have have liten to Andrew Maguire on KWN...fuck-me!!!

Like I wrote back in May, they are moving the entire game across to China:

Remember the first weak hands shake out and the CME's position?:

I started writing my blog purly to keep a record of the comments I wanted to make and especially the predictions I wanted to convey (based upon what they are doing, not what they are saying). Just imagine if I'm only 25% right on what I write in my posts, imagine the changes ahead?!

Paveway IV's picture

The Chinese state has far less gold reserves than western counterparts - they are stocking up for all the obvious reasons. Something I see missing in your otherwise well-reasoned blogs, TSP, is timing. 

How long will it take China to obtain all the gold reserves it would need to achieve pairity with the assumed reserves of the west? Their purchases are bound by price inflation they cause with such a huge demand. They can only sip while they would prefer to gulp.

How long will all that sipping take? One more year? A hundred? The Chinese state will be careful to manage the market price of gold (within their ability), and they have a lot of staying power. They don't have problems if this will end up being a 50-year-long undertaking if it needs to take that much time. We don't really know, and don't have access to any real information. I know there's a lot of information out there - I just think most of it is skewed to someone else's self-interest. 

I would be an enthusiastic buyer/seller of gold if I had an inside knowledge on the state of CPC's gold reserve purchases and program, but they are not talking. Will it even matter in a few years if a few billion Chinese decide they don't like the state mafia that runs the place now? 

Gold is never a bad investment over time. Would you (personally) be an enthusiastic buyer if you somehow knew it would take 20 years to be fairly valued? 40 years? I'm not suggesting it will - I have no idea. The only thing I know with certainty is that I won't be here in twenty years (mentally, anyways...) to see how this ends or benefit from it.  

TwoShortPlanks's picture

Well, I wrote this back in June. Now, there are many reports coming in and entities touting that China has in fact passed 5,000 Tons. My figures/prediction is that China passes 6,300 Tons by the end of this year.

Again, what nobody in this blogsphere seems to be able to grasp is that when the average Chinese citizen buys Gold and stores it at the PBoC, that adds to the Gold Reserves at the PBoC. Most in the West fear confiscation or corruption within Banks and won't do that, but not in China, this is the mind of the Han people!


CrashisOptimistic's picture

I know the ZH gold nazis will hate this but no one cares about them, or me.

Gold is not relevant to this matter.  Period.  There are more compelling truths in play, namely that China is the number 1 rice producer in the world, and they import rice for domestic consumption.  Number 1 cannot grow enough for its own bellies.

China is one of only 2 countries in the world whose domestic oil production is a state secret.  All numbers used for them are estimates.

China imports oil, allegedly in amounts now greater than US import totals.

Note that none of that involves gold.


Devotional's picture

"ZH gold nazis" - right, then we have paper bolsheviks that have led us into the abyss.

caconhma's picture

For the present geopolitical US$ reserve currency to work without escalating into a hyperinflation the excess/printed US$ must be removed from circulation. It is accomplished by Brazil, China, Japan, Russia, India, etc., buying the US Treasury papers, therefore, reducing the amount of US$ in the circulation.

The problem is that Brazil, China, Japan, Russia, India, etc., and the other countries cannot forever keep their own people starving so the USA and EU have the present high standards of living. So far, the elite of these countries were willing and/or forced to play this game. Just look at the communist China hypocrisy where former chairman Mao family members are US$ multi-billionaires and hundreds of millions Chinese have just a daily ball of rice. The Chinese, Russian, etc., elites are terribly corrupt having major problems controlling their citizens.

It is important to understand that the USA has no desire to pay back their international debt. This is just another form of the old colonial system. However, the pressure is building up in these countries. The US and EU elite arrogance and reckless behavior have made this system very unstable. Internet also has revealed that this system is very unfair to everybody outside of the US and few EU countries and local elite mafia running these countries.

Consequently, the Chinese elite is starting to look for ways to change the present situation.

Now about Gold. As long as China, Russia, etc., will not substantially reduce their US Treasury obligations buying the system will continue to function with gold staying in a doghouse.


Element's picture

I'll vote for the resources invested libertarians to win.

Seize Mars's picture

Um, china is not the world's number 1 rice producer. The USA is.

CrashisOptimistic's picture

Why would you post this without even the most cursory of checks?     The US is 13th.

Zer0head's picture

actually if you include Uncle Bens and Rice A Roni, the US is number one

Rubbish's picture

You didn't grow that, somebody else did !

Pegasus Muse's picture

Watched these two parts today. They jive perfectly with the Chinese editorial. Part 3 is The Police State which I shall watch tonight.  Should be interesting ...


01 - The Economic Crisis (The Fall of America & the Western World)  (62 min)


02 - Financial Armageddon (The Fall of America & the Western World  (46 min) 

Veterans toss aside memorial barricades, march on White House


algol_dog's picture

I though this article was an interesting read. Think it's getting really late in the game in USA. I found it quite ironic that 2 stories I heard on TV in the last 24 hours were the EBT story this weekend and the "congress to go home for the holiday weekend". Quite telling really ...

Seize Mars's picture


..uh, because I thought I knew what I was talking about? How's that for an answer?

Well it looks like I was wrong. Sorry. Don't drone me bro. The US was at one point, maybe my brain is getting old or something.

Just for giggles I will double-triple check at my job where I have some really good data. But 'til then, sorry.

Peachfuzz's picture

Not disagreeing, but to continue your thought (perhaps tangentially). The Chinese have some of the largest stockpiles of any commodities I could name, yet they import more. They are the largest holder of US paper abroad, so seeing the charades that go on in this country, and having long ago reached the conclusion that they will never be repaid; Do you suppose the ultimate goal of importation on such a massive scale would be to turn bullshit paper assets in to real tangibles? I would assume that to be the case.

Why have ghost city after ghost city, city blocks packed with blocks of aluminum, warehouses full of copper, and be developing Africa as far as they can reach were it not to position themselves to move away from worthless fiat? I'd take a ghost city over a pile of paper promises any day, it's not like 1.3 billion people are going to all of a sudden stop breeding.

CrashisOptimistic's picture

Friend of mine in another venue spoke to this in the context of why Saudi Arabia buys US military equipment, but India diversifies with Russian equipment.

Answer, KSA takes dollars for oil and they want to get rid of them ASAP at a likely discount. 

A time likely will come when KSA decides to have an aircraft carrier, and they'll want it in 2 weeks.  The US buys 1 million bpd from KSA.  KSA can say, no we don't want paper, we want an aircraft carrier.  In two weeks.  Yes, that means one already in your navy.

There is a global incentive to keep the dollar meaningful because so much depends on it, but the move away from it is probably underway, and it won't be to gold.  It will be to barter.

Ghordius's picture

Turkey diversifies with Chinese mil-ware

thisandthat's picture


KSA can say, no we don't want paper, we want an aircraft carrier.

They should call Signor Martini (scroll down):

Element's picture

Good luck with that, the US built up a massive Strategic Oil Reserve and fleets of aircraft carriers for a reason (plus call on oil sands production after that). Saudi Arabia would be occupied within those two weeks. As Sadam found out, it's hard to withstand or resist a mobile western air and ground force in a desert terrain, or to force them out of your capital. The Saudis themselves would actually be a very expendable nuisance, in that equation, so I don't like their chances of survival. Texas rough-necks would prosper instead ... but in the ME.

BurningFuld's picture

Note that none of that involves gold. Yet.



Race Car Driver's picture

> Fixed

Oh, Mr. Ranger isn't gonna like that, Yogi.

BeetleBailey's picture

Exactly...this, from a country that OPENLY LIES, and forces everyone to keep two sets of books....

Float ALL your currency bastards....and then some one might take these "threats" seriously....

Until then...sod off

Eeyores Enigma's picture

All reserve currencies end in massive blood flow.

Or maybe it will be like a big, friendly, all night (read decades long) game of monopoly where everyone will pat the winner on the back and go home.

Yeah right.

Anusocracy's picture

Of course they're interested in a NWO.

They have a better shot at being at the top of it than the US.

Dareconomics's picture

A new reserve currency would ultimately help the US economy.  Rather than hoarding dollars, foreigners will buy more US goods, services and investments.

LawsofPhysics's picture

Bullshit.  I think the rest of the world has had enough of our financial "products" of mass destruction.  Aside from that, there isn't anything the U.S. makes that other countries can't make themselves.  It does appear however that the U.S. has caught up with everyone else when it comes to corruption.

holdbuysell's picture

Spot on...moreso, the US has lost its 'muscle memory' for highly skilled manufacturing.  To wit, a few years ago, Andy Grove, founder of Intel, effectively said exactly that when referring to the difficulty of bringing semi manufacturing back to the US: the skills and capability are just not available anymore, making such a transition extremely difficult.

LawsofPhysics's picture

Indeed, time to put all the EBT'ers on a boat and send them right over...

NoDebt's picture

Empty the prisons first.  Then the EBT'ers.  You gotta follow the cookbook if you want this done right.

LawsofPhysics's picture

Who do you think will be driving the boats?  Yes, the "elite" will get the population back under a billion one way or another.

PhilofOz's picture

I can never see how that lines up with their obsession for infinite growth and profits on a finite planet. It's one or the other, but can't be both.

Ghordius's picture

Those prisons should not even exist in the fhe first place. And they are a source of this fear which leads to those cinic remarks

They increase the fears of the poor, the exposed and the rich. They feed an imagery of trapped people, dreams of zombies. They are a timebomb, a cancer, another idiocy only possible by endless streams of fiat subsidy which corrodes the moral fibre of the lower judiciary and enforcement personel. A perfect example that MOAR isn't the answer of everything

And they decrease the moral standing the Chinese mention

ThirdWorldDude's picture

I bet you in 500 SDRs that the Chinese will propose a solution that will include a basket of fiat toilet paper.

Saruman is having a mightily good belly-laugh right now...

Element's picture

Chinese are nationalistic, jingoistic and highly defensive of their sovereignty, plus entirely anti-foreign political and legal control of domestic issues. It's why they don't give a pluck about the global-warming agenda - same for Russia. What makes anyone think they give a toss about helping construct a western-judeo-banksterism paradigm?

I don't see what's in it for them.

Frankly, I think this imperial colonial-era 'global superpower' paradigm has almost completely played itself out. We have multipolar trading blocks who clearly despise hegemonic behavior.

Maybe the G-20 is an NWO, but it's just a bunch of big economies having a chat about how to best accommodate their bankster master's wishes.


... oh ... wait a minute ...

americanspirit's picture

So when Ben is no longer Fed chairman does that mean he no longer has federal bodyguards? Just strollin' down the streets of Princeton all by his lonesome?

Omen IV's picture

this message from the chinese is the same as Putin less than 60 days ago  - ex the currency remarks - i think the references to lies are mirror Putin language -  as well as sovern nations independence and domestic interference aimed directly at getting stopped out by the russians in Syria, grounding Bolivian presidents plane and stealing the intellectual property of Petrobras owned by the people of Brazil as cumulative US aggression  - that the chinese and russians are not going to take anymore nor are many of the BRICS and other small nations

the MIC/DOD/CIA/NSA are being called on to be dismantled in the new world order as well as the charter of US foreign policy  for the last 65 years of world wide interference and mayhem based upon "for profit" for the MIC, Oil Interests and the Banks.

Obama let the banks run scott free on the largest fraud in history that caused the destruction of many countries with their world wide fraudulent practices and therefore defacto part of US foreign policy on the use of the reserve currency status -they went too far and no one wants to be subjugated to the US banks  - via a reserve currency control  - stealing their own countires patrimony in the future with some new scheme.

we are on the verge of major change - the american people have no control nor democractic systems and the world knows it and says it  - the fourth turning is on!