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Russia And China About To Sign "Holy Grail" Gas Deal

Tyler Durden's picture


Several weeks ago we reported that in response to ongoing alienation of Russia by the west Putin was aggressively setting the stage for Russia's eastward expansion, set to culminate with a "holy grail" gas deal with China. We said that "while Europe is furiously scrambling to find alternative sources of energy should Gazprom pull the plug on natgas exports to Germany and Europe (the imminent surge in Ukraine gas prices by 40% is probably the best indication of what the outcome would be), Russia is preparing the announcement of the "Holy Grail" energy deal with none other than China, a move which would send geopolitical shockwaves around the world and bind the two nations in a commodity-backed axis."

Reuters added, reflecting on the recent trip of Rosneft executive chairman to Asia, that "the underlying message from the head of Russia's biggest oil company, Rosneft, was clear: If Europe and the United States isolate Russia, Moscow will look East for new business, energy deals, military contracts and political alliances.  The Holy Grail for Moscow is a natural gas supply deal with China that is apparently now close after years of negotiations. If it can be signed when Putin visits China in May, he will be able to hold it up to show that global power has shifted eastwards and he does not need the West."

It's time for an update. According to Itar-Tass, "Russia's Gazprom and China are poised to conclude a gas supply contract in coming weeks, the first in a series of energy projects planned between the two countries. "We’re working now to sign a gas contract in May," said Deputy Prime Minister Arkady Dvorkovich. "Consultations are continuing and Gazprom's leaders are holding talks with Chinese partners on the contract terms. We hope to conclude the contract in May and believe it should come into effect by the year end."

The key sticking point remains the price: "Base price is the only problem to be solved,” Dvorkovich said on Wednesday at a session of a Russia-China intergovernmental commission on energy co-operation, co-chaired by Chinese Vice-Premier Zhang Gaoli." However, even if Russia concedes the topline to China, it will surely "more than make up for it in volume" to borrow a line from Amazon, and furthermore the geopolitical implications from such a deal, not to mention the increase in national leverage vis-a-vis its dealings with Europe and the West, will more than make up for any immediately revenue shortfalls.

But wait - there's more in the rapidly shifting geopolitical axis which increasingly positions Russias as a key commodity source for China:

In other plans, Russian company Novatek’s Yamal region LNG (liquefied natural gas) project was near ready for signing, Drovkovich said. Russia's Rosneft had several interesting plans "seeking to increase maritime supplies by several million tonnes per year,” he said.


“Russia and China have agreed to jointly develop gas fields in (Russia's far eastern) Sakhalin and East Siberia,” Dvorkovich said. “We have discussed co-operation in the coal sphere, agreeing to develop deposits, supply equipment and build electric power plants as well as providing China with additional electricity supplies”.


“We’re finding mutually advantageous decisions on certain projects that will allow us to implement them in the shortest period of time,” Dvorkovich added. Conditions were right to speed the Tianjin oil refinery project and to build a petrochemical facility, he said.

This is happening as Ukraine announced overnight that it won't import Russian gas in April due to the surge in price that Gazprom is demanding from the US proxy state, and following ongoing Gazprom invoiving of how much Ukraine owes it which at last count was well over $2 billion - an amount which we be funded from the still to be finalized western aid to be provided for Ukraine.

Of course, at this pace, Ukraine and even Europe, will become far less meaningful markets to Russia as Putin prepares to announce what indeed would be the holy grail of gas supply deals, one that reduces Russia's reliance on European energy imports and substantially raises Russia's relevance to China as the two countries increasingly become the bestest of buddies.

Which certainly is also why, as Bloomberg reported this morning, "in the talks between China and U.S.’s Hagel overnight, the Chinese are taking a different tack. Rather than argue the merits of the disputed islands/history, they seem instead to say that it’s none of the U.S. business to get mixed up in something in another part of the world and between two sovereign nations. 

Bloomberg's conclusion: "Not only is this probably music to Putin’s ears, it also serves to ratchet up the tensions."

Just wait to see how "ratcheted up" tensions will be once Russia and China are finally locked into a bearhug of mutual codependence.


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Wed, 04/09/2014 - 09:53 | 4638958 savedeposit
savedeposit's picture

Ding Dong Dollar !

Wed, 04/09/2014 - 09:59 | 4638978 LawsofPhysics
LawsofPhysics's picture

less about the "dollar" and more about simply not wanting to "play the game" with a bunch of spoiled arrogant cunts from the west...

We all remember playing monopoly as a kid, eventually one player had all the property, all the cash etc., and the rest of the players simply said "fuck it" and went outside to do something else...

same as it ever was...

Wed, 04/09/2014 - 10:08 | 4639023 Greenskeeper_Carl
Greenskeeper_Carl's picture

thats a good analogy. Ever since i became aware of how all this works, Ive wondered how long the rest of the world would give us real things, especially oil, in exchange for worthless pieces of paper that we print out of thin air to give them. pretty crazy once you realize that is essentially all we have been doing, and that we have gotten away with it for so long.

Wed, 04/09/2014 - 10:20 | 4639079 McMolotov
McMolotov's picture

It's hard to know whether the people who came up with the scam were absolute geniuses or whether everyone else was just profoundly stupid. Either way, it's been a great scam for some well-connected people, and it'll work until it doesn't.

(At which point they'll come up with something equally as devious and screw everyone all over again.)

Wed, 04/09/2014 - 10:32 | 4639121 SoilMyselfRotten
SoilMyselfRotten's picture

Easy to understand Carl. They either use our currency or we give them a gentle reminder(bombs).

Wed, 04/09/2014 - 10:34 | 4639137 RafterManFMJ
RafterManFMJ's picture

The, then, is how fiat dies; not with a bang but a whimper...

Wed, 04/09/2014 - 10:45 | 4639174 Max Hunter
Max Hunter's picture

We give them an offer they can't refuse.. literally..

Wed, 04/09/2014 - 11:10 | 4639267 Withdrawn Sanction
Withdrawn Sanction's picture

Well, maybe.  The bully method (favored by the likes of John McStain, and John "Horseface" Kerry among many others) has worked before.  But you wonder for how much longer will it continue to work?  After all making weapons and arming combatants takes money, lots of it.  Moreover, the technology of destruction itself is changing.

CBS was interviewing some USN Admiral the other night about his fancy new rail gun based on EMP technology that can hurl a projectile at mach 7+.  It could penetrate multiple layers of inch thick steel. The cost of the projectile (basically a cone shaped hunk of metal) was reported to be $25K a pop, compared to a ballistic missile costing several millions apiece.  The Admiral was positively glowing about the technological advance his boyz in the research dept had come up with.  It apparently hadn't dawned on him that his invention completely changes the dynamics of traditional naval operations.  The USN's multi ship fleet is now a floating anachronism (or at least, very soon will be).  It's a bit like medieval castles when faced w/the invention of gun powder.  Castles are good against archers and swordsmen, but against cannon, not so much.

Wed, 04/09/2014 - 11:16 | 4639294 Big Slick
Big Slick's picture

shi+'s getting real

Wed, 04/09/2014 - 11:36 | 4639387 Tabarnaque
Tabarnaque's picture

The move away from the USD as the world reserve currency is inevitable. The Ukrainian blunder will only accelerate it. Now Russia and China fully understand that no one can be friend with the fascists in Washington. They want nothing else than total and complete world hegemony. Ukraine was a direct assault against Russia. The West will not accept a multi polar world. Therefore, the gloves are off and the war has already started. In my opinion, Ukraine is the point of no return. There can be no truce or peaceful cooperation with the fascists that are at the top of the Anglo-American Banking Cartel. 


On one side this is a fight to dominate and on the other side it is a fight to survive. My money is on the other side. I think that the BRICS will survive and the fascist empire will fail. And they very well know where the Anglo-American Banking Cartel is the most vulnerable. Therefore, I would expect a direct and full frontal attack on the USD as soon as they can mount it. The guns are being loaded as I write these lines. I doubt that it will take more than 12 months as most of the mechanics of such frontal attack will be operational in less than 6 months; BRICS Development Bank, the Yuan being fully convertible, several Gold physical exchange platforms, direct swaps agreement between China and its most important trading partners, Russia Pro 100 monetary transfer system, the BRICS undersea internet cable with its own SWIFT-like banking transfer system, etc... This is all coming operational within the next 6 to 12 months. This is not coming out of a fiction book. This is all very real stuff.


There is so much "money stored" in USD that when the move away from the USD starts, it will be violent. Investors won't have time to get out. I think it will be some sort of "over the weekend" devaluation.

Wed, 04/09/2014 - 11:52 | 4639454 Latina Lover
Latina Lover's picture

On the face of it, why shouldn't Russia and China do bilateral deals, with no USD's in the middle?  The main reason why the rest of the world does not do this is due to the US military threat, fronted by financial, electronic and economic warfare.  The USSA is  attacking China and Russia via non military means, and they will harm both economies, but in the end neither nation will be forced into submission.   Ultimately, the US will denied victory unless we are stupid enough to go nuclear, then ALL will lose, even the banksters hiding in their bunkers.

Wed, 04/09/2014 - 12:51 | 4639673 Jack Napier
Jack Napier's picture

I am amazed by how many people here actually believe that the West and the East aren't under the same iron fist. This is and always has been about wealth transfer and class warfare, not nation warfare. The West is deliberately shifting power to the East, after the East willingly let us play our games for the last few decades. We created the global world reserve currency to kill real money, the powerhouse of the West has been stripped bare thanks to this very globalization, and now the promises that were made to the East in order to allow this to happen are being fulfilled. It's all about screwing over the working class. Leaders on both sides don't care about their respective countries, and they aren't "blundering" anything. I mean honestly, we destroyed China's currency when silver was demonetized, and yet they are willing to buy up all our debt out of the goodness of their hearts? Or maybe it's because they know we will pay it back since we are good for it, HA! No, it's all scripted. Their cooperation was required, and now it's their turn to be on the receiving end. If not for the actions of the West in Ukraine, none of this would be happening right now. Forget about supposed intent. Cause and effect will light the way.

Wed, 04/09/2014 - 13:09 | 4639786 Manthong
Manthong's picture

“It's hard to know whether the people who came up with the scam were absolute geniuses or whether everyone else was just profoundly stupid.”

Not hard to know with even a bit of research.

The last (and for our purposes final) go-around was in 1913.


Everyone, including the princeton potus (small caps intentional) were scammed by the english/german bankers.

They got the money, control and luxury while the rest of the world got war, poverty and death.

Wed, 04/09/2014 - 13:36 | 4639916 Snidley Whipsnae
Snidley Whipsnae's picture

Jack... The 'old money' in China was around long before the name Rothchild existed. It's still around and calling the shots in China... and probably the rest of the banking world.

Who knows how much PMs the old Chinese families have buried, for centuries, under Chinese gardens, pig pens and homes?

Their patience and regard for generational wealth and secrecy is beyond anything we can imagine.

Granted the Jews and some gentiles are good with money... but pikers and new comers compared to the Chinese.

Wed, 04/09/2014 - 19:36 | 4641272 TheFutureReset
TheFutureReset's picture

If they are so ultimately conniving and evil, why would they trust each other? I think they may have formed a pact when the Chinese saw something in it for them. The "five families" (godfather reference) agreed on the rules and the territory. Now some of them want a new Don, or a new agreement cutting up the head families territory and property. It's in their nature to plot and scheme for power and influence. They trust no one, so all coordination is temporary. We are witnessing the end of that temporary coordination. 

Wed, 04/09/2014 - 11:36 | 4639394 Newsboy
Newsboy's picture

We don't need no stinkin' dollars.

Wed, 04/09/2014 - 11:55 | 4639456 eatthebanksters
eatthebanksters's picture

We were so prepared for this weren't we? Our CIA and NSA had all the information so we could be ahead of all this right?  We have answers, right?  Valerie Jarrett will tell her puppet, er, I mean Obama, how to spin this fucking disaster and our dumbed down polulation will have no clue as to the implications that all these actions have on their future.

Wed, 04/09/2014 - 11:27 | 4639348 Freddie
Freddie's picture

The Russian anti-ship missiles are not too expensive and they can be hidden on freighters, on trains, semi trucks plus surface ships and jets.

Surface ships including carriers are becoming an anachronism. As long as you could beat up, destroy, mass murder and loot countries with no one standing up to them - you were golden. The corrupt media could spin it as democracy.

Russia has started standing up to the bully.

Wed, 04/09/2014 - 13:21 | 4639845 BlindMonkey
BlindMonkey's picture

I want to take your thought to the next level:

If these ASM missiles are good enough to make warships an anachronism as you say an interesting thing will happen. There will be no global hedgimony based on military power projection. All power will become regional in scope because shipping will only be effective under the he ageis of the ASM umbrellas that are provided by the home/allied countries. Places like the Med may be demilitarized altogether because there are some many disparate powers operating in proximity.

Just a thought.

Wed, 04/09/2014 - 12:23 | 4639583 AbbeBrel
AbbeBrel's picture

Humm yes - the paradigm shift is upon us.   Should be short gunpowder and old tek.   Like most of Western Europe.   Long micro-flechettes and backpack based quadcopters for personal protection.    Guess what folks, things change.  


and as usual from Clarke (wikipedia):


Clarke's Second Law: The only way of discovering the limits of the possible is to venture a little way past them into the impossible.

"Hazards of Prophecy: The Failure of Imagination" in Profiles of the Future (1962)

Clarke's Third Law: Any sufficiently advanced technology is indistinguishable from magic.

Profiles of the Future (revised edition, 1973)

Wed, 04/09/2014 - 14:28 | 4640105 post turtle saver
post turtle saver's picture

rail gun tech is going to obsolete a _lot_ of current military thinking, strongly agree... let alone what it means for the Navy, if I were the Air Force I'd start to wonder about the viability of manned flight in 20 years...

MIC porn:

Wed, 04/09/2014 - 16:22 | 4640645 SteveNYC
SteveNYC's picture

From what I've read, the rail gun is a long way off from being effective in an actual "battle" situation:


Issues with the barrel, wear and tear etc. Interesting reading.

Wed, 04/09/2014 - 11:11 | 4639274 SamAdams
SamAdams's picture

Actually, the people who installed the FED, and the Congress who allowed it, were aware.  However, if you have the power to create money, you also have the power to buy the support of men and women of low integrity and having weak virtue.

Lots of Senators were against it, they were coerced, sometimes fatally into silence.

The scam predates the FED.

Wed, 04/09/2014 - 11:22 | 4639314 Herd Redirectio...
Herd Redirection Committee's picture

And upon discovering it, you have two options:  Try to stand against it, or try to profit from what you know.

And unfortunately, for the last 100 years, men have found it more profitable to NOT stand against!

Wed, 04/09/2014 - 10:56 | 4639224 HardAssets
HardAssets's picture

But then the bastards come up with some other fiat made up outta nothing . . . like the SDR

Wed, 04/09/2014 - 11:08 | 4639265 Four chan
Four chan's picture

can two back stabbing bastards mkae a deal with one another that works?

Wed, 04/09/2014 - 11:15 | 4639290 SamAdams
SamAdams's picture

The real question is, How is that the Communist societies are joining in resistance to the Capitalists, while also taking hold of the gold?  Meanwhile, the controllers of the Home of the Free are busy weakening its core. 

Almost sounds like they are purposely destroying the last thing that stands in their way of the global coup.  Using Russia and China as the "good guys" against the "bad guys", when if fact, they all have the same ultimate goal.

Wouldn't be the first time both sides are played against the middle.

Wed, 04/09/2014 - 14:35 | 4640137 TruthTalker
TruthTalker's picture

He is correct - after this what more do you need to know?

Wed, 04/09/2014 - 11:56 | 4639467 Took Red Pill
Took Red Pill's picture

except many of them now have their own bombs, too.

Wed, 04/09/2014 - 10:31 | 4639124 0b1knob
0b1knob's picture

 "Base price is the only problem to be solved,”

??????????????????   Nothing to see here people, move along.

Wed, 04/09/2014 - 12:39 | 4639661 Urban Redneck
Urban Redneck's picture

The oringal MOU that kicked off this process was signed almost 4 1/2 years ago...  A lot of obstacles have been overcome in the interim, but this one has been dragging on for a while, and the only thing that has changed in the recently is Ukraine...

Wed, 04/09/2014 - 12:31 | 4639613 Snidley Whipsnae
Snidley Whipsnae's picture

Mac... "it's been a great scam for some well-connected people"

It's been a great scam for the vast majority of Americans that have gas guzzling SUVs, homes with air conditioning, vacations, good pay (once upon a time), and lots of other niceities that the other 95% of the world did not have.

The end of dollar world reserve status is a huge game changer for Americans.

They just don't know it yet.

Wed, 04/09/2014 - 10:46 | 4639178 Mercuryquicksilver
Mercuryquicksilver's picture

Worthless?  I think not, they're backed by the full faith and credit of The Federal Reserve.


We lost the cold war too. We just lost it after USSR and its taken 30 years to figure it out.

Wed, 04/09/2014 - 10:48 | 4639187 kito
kito's picture

greenskeeper you forget we give the world democracy and capitalism. its our global responsibility to dethrone evil dictators (only the ones who dont toe our line of course), free the people, install a "democratically elected" leader, teach them free market capitalism by assisting them with their resource rich "export business" to the u.s., and help the masses by providing humanitarian loans in the billions and help them trim the wasteful spending so they can learn "fiscal responsibility". the

no greenskeeper, we do alot more than just give away worthless pieces of paper. we save the world.  

Wed, 04/09/2014 - 11:12 | 4639281 ATM
ATM's picture

We will eventually give them real things in return, American companies, natural resources, real estate as all those paper bills eventually flood back to the US seeking anything of value.


Wed, 04/09/2014 - 12:38 | 4639659 Snidley Whipsnae
Snidley Whipsnae's picture

ATM... Yes, we will. 

Last estimate I heard there is ~ $7 Trillion held oversear and I believe that to be a low ball estimate.

My new neighbors might be speaking Russian and Mandarin or who knows what.

The TV reruns will have various languages scrolling across the bottom of the screens.

Jefferson predicted this very event would happen if we turned over our money to bankers.

Wed, 04/09/2014 - 11:33 | 4639376 teslaberry
teslaberry's picture

what in tarnation are you talking about? 

essentially all we have been doing is going to war again and again. 

the worthless paper given to the loser is just what happens during prolonged 'rest' periods in between wars that we call 'peacetime'. 


bretton woods bitchez.

Wed, 04/09/2014 - 12:10 | 4639534 FlyingDutchman
FlyingDutchman's picture

As long as you have the biggest guns.

Wed, 04/09/2014 - 12:13 | 4639545 horseman
horseman's picture

The govt may have paid with paper, but the people of the US have paid with blood, at least those families that serve.  Not a very good trade for the people.

Wed, 04/09/2014 - 10:10 | 4639036 I am more equal...
I am more equal than others's picture



Supply and demand imbalances affect value. 

Demand for dollars are about to decrease. 

Supply remains the same (really increases with Fed printing-fest)

Sounds like an inflation inducing event.


Wed, 04/09/2014 - 10:16 | 4639066 Oracle 911
Oracle 911's picture

"Sounds like an inflation inducing event."


It is actually hyperinflation inducing event.

Wed, 04/09/2014 - 10:22 | 4639088 insanelysane
insanelysane's picture

"Never get in a commodities war with Asia"


Wed, 04/09/2014 - 10:12 | 4639048 Kina
Kina's picture

And when the US thought it might lose it started a war in the players backyard.

Wed, 04/09/2014 - 12:57 | 4639739 Things that go bump
Things that go bump's picture

When losing at chess knock the board with your elbow and say "oops."

Wed, 04/09/2014 - 10:15 | 4639057 KickIce
KickIce's picture

Except in this case when you go outside you find out that the same kid owns the playground and the toys as well as the ice cream truck.

Wed, 04/09/2014 - 10:37 | 4639148 Seasmoke
Seasmoke's picture

And the drones ABOVE you. 

Wed, 04/09/2014 - 10:51 | 4639199 LawsofPhysics
LawsofPhysics's picture

Bullshit, I know where the real owners live.

Wed, 04/09/2014 - 11:46 | 4639429 Raymont
Raymont's picture

The only winning move is not to play.

Thu, 04/10/2014 - 09:01 | 4642726 Rafferty
Rafferty's picture

Well the one good thing for the Ukrainians is that their gold is now (cough) safe in America.

Wed, 04/09/2014 - 10:01 | 4638992 rubiconsolutions
rubiconsolutions's picture

Glub, glub, the petrodollar sinks slowly into the abyss.

Wed, 04/09/2014 - 10:11 | 4639038 sushi
sushi's picture

Any news on the overnight invasion of The Eastern Ukraine by The Russia?

I checked Facebook and Twitter to see if The War had broken out but everything appears pretty stealthy so far.

Wed, 04/09/2014 - 10:12 | 4639043 Smegley Wanxalot
Smegley Wanxalot's picture



Ding dong, the buck is dead,

the which old buck,

the fucked up buck,

Ding dong the fucked up buck is deadddddd!

Wed, 04/09/2014 - 10:28 | 4639112 Flakmeister
Flakmeister's picture

Projecting much, are we?

Wed, 04/09/2014 - 10:35 | 4639138 BandGap
BandGap's picture


Using LNG the Chinese could also move towards cleaning up their polluted air space.

Not to judge, but Russia has to be very careful with China in "developing" the eastern half of Russia. China has always coveted that part of their world.

Wed, 04/09/2014 - 11:27 | 4639276 HardAssets
HardAssets's picture

Military invasions are a crude, primitive tool. Afterwards the result is very expensive in the occupation costs of controlling a resentful native population of people. You can get the things you need & want through trade. Then your neighbors are partners in mutually beneficial exchange. It seems some nations in the West have forgotten these principles. They think the 'top dog' can do anything to others that they want.

China hasn't displayed imperalistic military ambitions for many centuries. They have been internally focused. Even territorial disputes are over land which they have considered part of China.  No one but the US has the equivalent of military bases all over the globe.  While you can never say 'never' - - - and egomaniac leaders often head down the imperalistic road, there hasn't been an indication of this currently in regards to China.


If you wanted to create a truly prosperous and secure nation, the US would get back to its (stated) founding principles. Schools would teach real history, critical thinking skills, and encourage independent & creative thinking. Government would be seen as being for the purpose of pursuing mutually beneficial goals and would be drastically eliminated in those realms where a benefit didnt exist. Entrepreneurship would be encouraged. We The People would be recognized as the foundation and master of government rather than the reverse. Individual liberty and responsibility would be the basis of society and citizens would question whatever they were told. We would be a nation of people pursuing our own happiness and excellence. We would have the capacity to defend ourselves, but would leave other people in other lands alone to find their own destiny.  Such a place would be an example to others (though they would be free to follow, adapt ideas to their own needs, or reject it all as they saw fit). 

Such an example would be a threat to megalomaniacs at home and around the world, of course.  They thrive on fear and dependence.

Wed, 04/09/2014 - 11:58 | 4639480 swmnguy
swmnguy's picture

To further your point, the Chinese have been extremely aggressive with global trade.  I was once coordinating a business meeting in Shanghai that got booted from our (contracted and paid for) venue because at the last minute the Chinese Finance Ministry decided they were going to use the space for a meeting with 28 African Finance Ministers.  The Chinese built up the oil infrastructure in Eastern Libya, in Southern Sudan, in the Horn of Africa, and they're heavily involved in Southeast Africa.  Actually--funny coincidence--many of the places where there has been recent US covert and overt military intervention in Africa, and many places where there have been violent insurgencies and Al-Quaeda jihadi terrorism, it's right where the Chinese have spent billions building up trade relationships and infrastructure.

The Chinese have been fiddling around with statecraft for about 3000 years.  They're observant of trends.  They know their own capabilities and limitations, and those of others.  They aren't going to play into US hands through military aggression because that's the US's game.  They also aren't going to stand by while the US steals all their overseas investments.  They'll respond according to their own capabilities and limitations.  The US's toolkit of interconnected finance and military coercion has worked very well for us.  But it's not the only set of options available.  The Chinese know this.  They, and the Russians, have been dealing with the Kissinger/Brzezinski "realpolitik" reign of terror for 50 years.  They have a pretty good idea by now of how to respond, when the conditions are right.  I think we're running low on ammo, and I think the Chinese and Russians know it.  Soon we'll all get to find out how they choose to move forward toward their own aims.  I don't suppose we're going to enjoy it one bit.

Wed, 04/09/2014 - 12:47 | 4639707 Snidley Whipsnae
Snidley Whipsnae's picture

swmguy... To sum up.

What the Chinese have that America does not is PATIENCE.

Russia, especially Putin, seems to be learning from watching the Chinese.

Wed, 04/09/2014 - 13:09 | 4639790 Oracle 911
Oracle 911's picture

"Russia, especially Putin, seems to be learning from watching the Chinese."


Nope, Putin as ex-KGB officer knows very well what is going on.

He just simply couldn't move freely until recently due the 5th column paid by US NGO's/NED.

Wed, 04/09/2014 - 13:20 | 4639850 Snidley Whipsnae
Snidley Whipsnae's picture

Putin displayed a remarkable amount of patience when dealing with Georgia and is now showing lots of patience while being baited by the US and it's NGO clowns in Ukraine.

Putin is sitting on what Ukraine and all of Western Europe MUST have... gas and oil. Putin knows if he plays this hand correctly he can drive a wedge between the US and NATO and weaken or destroy NATO. 

Western Europe has a couple of months of gas reserves left... after that is gone, what?


Wed, 04/09/2014 - 14:00 | 4639990 Oracle 911
Oracle 911's picture

We go Argentina/full retard OR we will dance like Putin whistle.

Even after "our dear leaders"* pick the 2nd option (I'm from Europe), it doesn't ensure the Europe's stability (French and the PIGS on the verge of the default and it is same for the European TBTF banks).


*Sorry I don't know enough English cursing words for properly addressing them. ;)

Wed, 04/09/2014 - 13:10 | 4639768 Oracle 911
Oracle 911's picture

" I don't suppose we're going to enjoy it one bit."

Except you have a rape fantasy about  being on "receiving" end.

Wed, 04/09/2014 - 11:44 | 4639425 tempo
tempo's picture

Obama/Kerry still make beautiful speeches that make the liberals pee down their legs. T Korea/Japan and many other E Asian countries face a dangerous fate depending on the West for their security. In a another decade, they will be slaves to the new powers.

Wed, 04/09/2014 - 09:54 | 4638959 Silver Garbage Man
Silver Garbage Man's picture

Hello gold

Wed, 04/09/2014 - 12:14 | 4639547 tempo
tempo's picture

Nearly all equity funds worldwide are overweighed in US stock. If the economic power continues to shift to the East so will the equity funds and US stocks will drop.

Wed, 04/09/2014 - 09:54 | 4638961 Max Damage
Max Damage's picture

Don't worry we've got loads of fuckin windmills!!!!!!

Wed, 04/09/2014 - 10:17 | 4639067 IridiumRebel
IridiumRebel's picture

Let's go full Dutch 17th century. Our dollars are like tulips!

Wed, 04/09/2014 - 11:30 | 4639359 Big Slick
Big Slick's picture


(look it up)

Wed, 04/09/2014 - 09:54 | 4638963 scubapro
scubapro's picture

two corrupt regimes doing biz together...each trying to perpetually get over on the other.  neither can create, neither can add value, neither is a nation of laws.  should be fun to watch

Wed, 04/09/2014 - 09:56 | 4638965 LetThemEatRand
LetThemEatRand's picture

I missed it.  You're talking about the U.S. and who else?

Wed, 04/09/2014 - 09:58 | 4638970 Skin666
Skin666's picture

I think he's talking about the E.U.S.S.R Rand ; )

Wed, 04/09/2014 - 10:16 | 4639064 V in PA
V in PA's picture

I think he is talking about... "insert any two Governments here".

Wed, 04/09/2014 - 10:24 | 4639093 Herd Redirectio...
Herd Redirection Committee's picture

"can't create, can't add value, is not a nation of laws"

USA and UK were the first ones to come to mind, personally!  Complete two-tier justice system, depending on if you can afford 1 lawyer, or 6.

Wed, 04/09/2014 - 11:12 | 4639282 Troll Magnet
Troll Magnet's picture

USIsrael. Talk about axis of evil...

Wed, 04/09/2014 - 09:58 | 4638972 savedeposit
savedeposit's picture

the "EU" I guess

Wed, 04/09/2014 - 09:59 | 4638977 Kirk2NCC1701
Kirk2NCC1701's picture


Wed, 04/09/2014 - 10:01 | 4638989 LawsofPhysics
LawsofPhysics's picture


Let me be clear; "When fraud is the status quo, possession is the law."

that is all...

Wed, 04/09/2014 - 10:01 | 4638994 Greenskeeper_Carl
Greenskeeper_Carl's picture

What he said could be true of pretty much any country in the world. This does not bode well for the petro dollar, but there isn't really a viable alternative out there. All these countries are currency manipulators, china is going through a lot of its own problems, which keeps coming back to the USD being the cleanis dirty shirt. None of them want any kind of gold based system, since none of them want honest money, since their schemes all rely on a currency that can be manipulated and devalued on a whim.

Wed, 04/09/2014 - 10:05 | 4639010 Spastica Rex
Spastica Rex's picture

Until there's a disruption, the status quo (American/western dominance) holds. Period.

Mexican standoff.

Wed, 04/09/2014 - 10:14 | 4639055 IridiumRebel
IridiumRebel's picture

Holy shit that's funny....

Wed, 04/09/2014 - 10:00 | 4638982 Bernanke'sDaddy
Bernanke'sDaddy's picture

Mr. Corzine, is that you?



Fucking NSA stooge.

Wed, 04/09/2014 - 10:03 | 4638999 Toolshed
Toolshed's picture

"two corrupt regimes doing biz together...each trying to perpetually get over on the other.  neither can create, neither can add value, neither is a nation of laws.  should be fun to watch"

You are obvioulsy referring to the US and the EU.

Wed, 04/09/2014 - 10:45 | 4639176 CuttingEdge
CuttingEdge's picture

One man's corruption is another man's lobbying.

Remind me again, how much drug, bank, oil and military corps contribute to Congress to "grease the wheels" of their profitable endeavors. If you want extreme corruption at the highest level, look no further than Uncle Sam or that fat bitch Britannia. In general Western polititians are corporate fascist filth. Sad there aren't many exceptions.

Wed, 04/09/2014 - 11:14 | 4639288 Rakshas
Rakshas's picture

Canada and Stephen....... nope ..... can't even joke about that ....... Stephen Nutsenyahooo  and for any delusional Canucks out there....

I go puke now............ puke that a funny word......

Wed, 04/09/2014 - 10:04 | 4639002 Truther
Truther's picture


Wed, 04/09/2014 - 10:40 | 4639156 TrumpXVI
TrumpXVI's picture

Yup, and.... "Base price is the only problem to be solved.”

Wed, 04/09/2014 - 17:34 | 4640940 scubapro
scubapro's picture

apparently I have struck a nerve.   didnt realize there were so many pro-fascist types here.   and yes, while the us erodes everyday our civil liberties, russia and china have far far fewer.   laws are by far more subjective in russia/china.    so when is the giant pipeline or 15000 gas tankers going to be built for this project?  maybe thats the growth AA was referring to.

Wed, 04/09/2014 - 09:59 | 4638969 cornflakesdisease
cornflakesdisease's picture

We know that "the boys" who rule the world have included "the boys" from China since 1971.  In fact, the Chinese gov owns 16% of the FED banking system via proxy.

So what if, to take control of Russia once and for all, the job is farmed out to the Chinese to get Russia totaled economically hooked on them and thus bring them into the fold, because Russia Central bank is not part of the system?

Oh yes, the dollar will collapse, as soon as we run out of zero's.

Wed, 04/09/2014 - 11:09 | 4639082 socalbeach
socalbeach's picture

When people talk about the dollar's collapse they mean its value will collapse.  In a base 10 system, adding just one zero to the total quantity of dollars means a factor of 10 increase in the supply aka a 90% loss in purchasing power.

Wed, 04/09/2014 - 09:58 | 4638973 buzzsaw99
buzzsaw99's picture

Just like the usa housing bubble nobody could have seen that coming. [/sarc]

Wed, 04/09/2014 - 10:00 | 4638980 MrTown3
MrTown3's picture

Just in time for the Tetrad

Wed, 04/09/2014 - 10:00 | 4638983 Paper CRUSHer
Paper CRUSHer's picture



The ZH audience response......

Wed, 04/09/2014 - 10:01 | 4638990 Robot Traders Mom
Robot Traders Mom's picture

It is scary to witness an empire losing all control. Nobody knows what the government is capable of...

Wed, 04/09/2014 - 10:14 | 4639050 q99x2
q99x2's picture

Nobody even knows what  the president's name is or where he was born. Some people think he is black and other's say his mother is white. Most do agree though that he works for foreign global interests.

Wed, 04/09/2014 - 10:01 | 4638993 Z_End
Z_End's picture

1 May I say is the announcement... Mayday Mayday Mayday...

Wed, 04/09/2014 - 10:02 | 4638995 HamRove
HamRove's picture

Ohhhh GOODIE!!

Tick tock Petro Dolla'

Wed, 04/09/2014 - 10:02 | 4638996 Frostfan1
Frostfan1's picture

Big deal, they'll both be hedging in dollars on the side.  If you think either one of these trusts the other corrupt side to blindly do these deals without the dollar backing them somehwere, good luck.  The Russians will love all those high yield Chinese Trust bonds haha they will get offered soon.

Wed, 04/09/2014 - 13:12 | 4639803 Snidley Whipsnae
Snidley Whipsnae's picture

Frostfan1... I guess you have not noticed that Russia, China and most other central banks have been very aggressively accumulating gold for a lot of years.

The new BRIC bank could clear trades and provide 90 (or 30 or 60) day funding 'same as cash' to accomodate trade. Trade Notes could circulate as they did in days of yore and bear interest depending on time to expire. Banks of old considered the trade notes the very best of collateral... better than soverign notes. BRIC bank could be backed with gold or any basket of commodities.

But first we need govs and reserve banks out of the interest rate setting/commodity market fixing/floating currency business.

Fair trade will win over 'free' trade... cause Mr Market always wins in the end.

Wed, 04/09/2014 - 10:02 | 4638998 Duc888
Duc888's picture



scubapro: " two corrupt regimes doing biz together...each trying to perpetually get over on the other.  neither can create, neither can add value, neither is a nation of laws.  should be fun to watch"


Meh, they took notes from USA.

Wed, 04/09/2014 - 10:03 | 4639000 q99x2
q99x2's picture

Good now that the world is ending I have nothing to hold me back from studying.

Wed, 04/09/2014 - 10:31 | 4639125 RafterManFMJ
RafterManFMJ's picture

Im studying my seppuku technique as well.

Wed, 04/09/2014 - 12:40 | 4639675 ParkAveFlasher
ParkAveFlasher's picture

Practice makes perfect!

Wed, 04/09/2014 - 10:03 | 4639001 dogismycopilot
dogismycopilot's picture

by the way, to properly pronounce the word "oil" in Russian you want to pronounce the word "neft" like "knee-eft".

as in "vot nasha neft" (that's our oil) said the EU.


Wed, 04/09/2014 - 10:05 | 4639005 Omen IV
Omen IV's picture

Russia has 6.6 million sq miles of probable reserves of countless commodities and $45 billion in national debt 2.5% of GDP

and the US has $17 trillion in debt - 104% of GDP - all incurred in the pursuit of war and military since 1953 - plus the USA has the ultimate ASSet........Obama - which could be traded for ?

Wed, 04/09/2014 - 10:19 | 4639078 Kina
Kina's picture

It certainly paid off for the USSR to go bankrupt....maybe that should have happened iin 2008...maybe we would all be in a more hopeful position now.

Wed, 04/09/2014 - 11:34 | 4639377 Rakshas
Rakshas's picture

when you say 104 % of GDP....... are you quoting the Nominal Bullshit or is your GDP reference from shadowstats?? 

Wed, 04/09/2014 - 10:05 | 4639008 yogibear
yogibear's picture

Russia, China and others are figuring out a way to kill the Petro Dollar.

Yellen, Dudley, Evans and other Fed heads will help in the destruction of the US dollar by printing into infinity. 

Kill the US dollar and you defeat the US. Steal the financial centers from NYC to Asia and you substantially weaken the US.

The Federal Reserve is weakening the US, not strengthening it. 

Wed, 04/09/2014 - 10:12 | 4639044 SubjectivObject
SubjectivObject's picture

... the Federal Reserve is minining the US, not supporting it ...

Wed, 04/09/2014 - 10:17 | 4639069 Two-bits
Two-bits's picture

As in pulling things out of it or laying explosives within it?


oh, wait, nevermind.  I see what you did there.

Wed, 04/09/2014 - 10:56 | 4639221 Leaping Lizard
Leaping Lizard's picture

It has been part of the Globalist agenda since way before Nixon/Kissinger  to cripple the USA.  They don't want any strong nations on the planet, particularly one that had a tradition of personal liberty.  They fear that the people might somehow come out of their MSM induced trance, get off their couches, turn off their boob tubes, and kick them in the ass, or perhaps even go looking for a rope and the nearest streetlight.

Wed, 04/09/2014 - 11:07 | 4639260 Herd Redirectio...
Herd Redirection Committee's picture

Hence the demonization of the freedom-loving, historically educated white male...

Wed, 04/09/2014 - 10:09 | 4639030 rsnoble
rsnoble's picture

Is this the 'axis' of evil we were warned about?  Looks as if the US predicted the future and made it come true. LOL.

Wed, 04/09/2014 - 10:10 | 4639037 yogibear
yogibear's picture

Russia can still sell to Europe, just demand payment in gold.

That would send the US and European markets reeling.

Wed, 04/09/2014 - 10:23 | 4639090 philosophers bone
philosophers bone's picture

Couldn't EU / Germany just assign its interest in the gold held in U.S. vaults and promise to deliver it to Russia in 2020?

"FUCK THE EU"?  Already done.

Wed, 04/09/2014 - 11:01 | 4639244 Leaping Lizard
Leaping Lizard's picture

Actually the Fed only "promised" to deliver 20% of Germany's gold by 2020.  lol  Strange.  If someone stole my financial assets, I wouldn't regard them as a staunch ally.  But then again, German debt slaves are just as mind fucked as USSA debt slaves and Obomba, Merkel, and Dudley are working for the same Satanic masters.

Wed, 04/09/2014 - 13:19 | 4639837 Things that go bump
Things that go bump's picture

To say we are "storing" their gold for them is only a face-saving technique to allow both parties to continue to deal amicably with each other. They lost WWII and the US won. To the victor go the spoils. They can call it theirs as long as they don't want it back. I imagine that in 2020, if events don't overtake us, there will be another lengthly delay. 

Wed, 04/09/2014 - 10:15 | 4639056 RealityCheque
RealityCheque's picture

Quick America, start a war. It's your only option and its seemed to work so well in the past!!

Wed, 04/09/2014 - 10:24 | 4639095 insanelysane
insanelysane's picture

In the last big one, Russia and China were enemies of our enemies.  Not sure how it would turn out with both of them as our enemy.

Wed, 04/09/2014 - 11:00 | 4639240 philosophers bone
philosophers bone's picture

I still wonder if it's guaranteed that the soldiers will "fight".  Is it worth fighting for the right to be lied to, spied on, droned, deceived, taxed to death, Cypressed?  The line between the "Good Guys" and "Bad Guys" is less clear.

Wed, 04/09/2014 - 11:05 | 4639254 Leaping Lizard
Leaping Lizard's picture

USSA soldiers in combat zones are so drugged up with DoD mandated pharmaceuticals and vaccines, they barely know up from down.  When they are used up, they come back to the Homeland and commit suicide.  Rinse and repeat.

Wed, 04/09/2014 - 11:11 | 4639277 Herd Redirectio...
Herd Redirection Committee's picture

Yep, because they finally understand it was NOT worth it, they were lied to, they aren't getting the education and benefits they were promised (never mind if you are disabled, depressed, maimed, etc), and they're not considered heroes either.

And to top it all off, their career in the army far exceeds anything they can achieve outside of it, due to lack of opportunities (except working as highly militarized law enforcement officers, of course).

Wed, 04/09/2014 - 10:16 | 4639062 Kina
Kina's picture

If Russia said it would accept payment in the gold price hit stupidly high levels as the manipulation reverses polarity. When 1oz of gold goes from 1300 to 130,000 an oz thats 100 times the purchasing power for gas.



Wed, 04/09/2014 - 10:16 | 4639065 matrix2012
matrix2012's picture

This pretty close cooperation ("codependence") between Russia and China in all aspects not only energy sector will serve the rest of the world (beyond the ZATO axis incl its puppets) the positive developments and dissolve the ruggedness of the unipolar world!

Our planet simply can't be unilaterally policed by the self-installed global cop with all its negative consequences... how many tragic instances of Iraq, Afghanistan, Libya, Syria that the world can continuously sustain???

Wed, 04/09/2014 - 10:19 | 4639074 b_thunder
b_thunder's picture

"The key sticking point remains the price"  LOL!  China holds all the cards!   Not only Russia doesn't have cheap and efficient means of delivering gas to China, China will dictate the price!  Russia is getting isolated indeed!  And that's a good thing.

And if China really wants to align with russia, there's nothing that prevents Apple from shifting iPhone assembly line from China to our new "proxy state" Ukraine.


Wed, 04/09/2014 - 10:21 | 4639084 Kina
Kina's picture

Not a geopolitical good risk ....

Wed, 04/09/2014 - 10:23 | 4639091 alien-IQ
alien-IQ's picture

to say this is a significant event would be the understatement of the year.

Wed, 04/09/2014 - 10:25 | 4639097 Winston Churchill
Winston Churchill's picture

I would l could  be a fly on the wall at tomorrows G20 meet.

Quick recap;

Sino/Russian gas oil deal in May.

Full convertability of yuan in Shanghai FTZ starts in June.

Futures/Options trading in yuan starts in Shanghai in July

Saudi starts selling oil in Yuan in  ???

Wed, 04/09/2014 - 10:26 | 4639102 yogibear
yogibear's picture

By Russia demanding the Europeans payment in gold it would instantly reverse the Central banks game and wouldn't bode will for the US dollar or Euro.

What fun.

Eventually they could force a transition to another reserve currrency.

Ding, ding US dollar...

Wed, 04/09/2014 - 10:27 | 4639109 Flakmeister
Flakmeister's picture

Yawn, somebody better check what fraction of Russian gas production and reserves this "mega-deal" encompasses...

Sakhalin and the far east forms a small fraction of Russian production and this implies a long term CAPEX commitment to increase production....

Only 3% of oil and gas production comes from the far east...

It is a pimple on the ass of an elephant...

Wed, 04/09/2014 - 10:33 | 4639110 Hannibal
Hannibal's picture

"Holy Cow", demand payment in Rubles.

I think I heard a shot.

Wed, 04/09/2014 - 10:58 | 4639236 1stepcloser
1stepcloser's picture

Petro-rubble system

Wed, 04/09/2014 - 10:31 | 4639122 A_Nejad
A_Nejad's picture

Chi Ching...Now where's that Popcorn!

Wed, 04/09/2014 - 10:32 | 4639128 luckylongshot
luckylongshot's picture

So in their efforts to isolate Russia the US has managed to destroy the petro dollar. the stupidity in all this is overwhelming.

Wed, 04/09/2014 - 15:13 | 4640295 813kml
813kml's picture

They missed the memo not to play with matches in a fireworks factory.

Wed, 04/09/2014 - 10:33 | 4639132 smacker
smacker's picture

The West's foreign policy co-operation - and by extension economic co-operation - towards Russia and China has been massively mismanaged in recent years. Ukraine is simply the latest round of gross political incompetence and misjudgement.

Clearly, the USG under Obama must shoulder much of the blame for this. But other bit players, notably the British government under Cameron & Hague and more recently the EU & Merkel have a lot of blame too. Stirring up revolution in Ukraine, followed by blaming it all on Russia is now reaping its come-uppance.

None of these arrogant asswipes can understand that to do mutually rewarding business with Russia and China one has to treat them with certain common respect, not treat them condescendingly. Again, the arrogance of John Kerry & Britain's William Hague towards Russia over Syria and now Ukraine has cost us plenty.

Where does it go from here?

Wed, 04/09/2014 - 10:37 | 4639149 Winston Churchill
Winston Churchill's picture

Downhill fast, like me when I drank.

Wed, 04/09/2014 - 10:58 | 4639234 Canucklehead
Canucklehead's picture

Senator Johnny Onions and the Liver Eaters are booked for the next three nights at the Club.

Tickets are still available.

Wed, 04/09/2014 - 10:34 | 4639135 Invinciblehandaxe
Invinciblehandaxe's picture

Now little hitler Merkel and fascist Barrosso can suck onto Obombers balls...

I guess we'll be running on Merkel's farts this winter in Europe

Wed, 04/09/2014 - 14:01 | 4639994 Zwelgje
Zwelgje's picture

Judging the size of her ass we Europeans might get threw the winter.

Wed, 04/09/2014 - 10:35 | 4639139 SharkBit
SharkBit's picture

You know what is kind of amazing as to me this looks like pretty massive news.  And yet the US stock market ignores simply continues to power on whilst real money (gold) continues to get hammered by Fed Bitch Banks.  Surreal to witness.  The US with all it markets is going to crash and crash hard.  RIP.

Wed, 04/09/2014 - 10:37 | 4639150 kenezen
kenezen's picture

We could have had that gas deal! But, Hey! Our economy is doing just great! just look at the figures our always honest government is putting out! Our economy moving ahead with less middleclass as a percentage than at anytime in our history. Our "Industrial Production and Exports" that made us a world power is at all time historic lows per percentage of population. 

Our debt is at historic highs and our Federal Government is turning very Socialistic. National programs and intrusion into States activities is at all time highs. Wealth dispersion is at wider percentages than at any time in history. Federal Employees now make double in wage and pension than a private sector worker! Our Federal Government tells us it will spend more to create jobs; but, those jobs are targeted to the minority Union laborers. 

This crash was created  while under Republican leadership and made Socialistic under Democrat leadership. Now our president is insisting on Executive solo rule! Yep, we're heading in a great direction as we lose our status as a Reserve Currency to China. We no longer resemble Jefferson's vision as much as Marx!  

Wed, 04/09/2014 - 10:54 | 4639208 smacker
smacker's picture

"Federal Employees now make double in wage and pension than a private sector worker!"

Doesn't that just say it all.

And in the UK, the people with gold-plated, index-linked pensions and more weeks vacation and sick days each year are guess who: Civil Servants and other assorted public sector workers.

That none of these people produce wealth but consume it, goes right over the heads of government.

Wed, 04/09/2014 - 10:43 | 4639166 Cornholiovanderbilt
Cornholiovanderbilt's picture

So the million $ question...As an American Goy do i learn mandarin or russian first?

Wed, 04/09/2014 - 10:45 | 4639172 Infinite QE
Infinite QE's picture

Mandarin. The Khazar plan is to have Russia fall for the overtures from China and then the Khazar-controlled China will turn on Russia.

Wed, 04/09/2014 - 11:02 | 4639248 DeliciousSteak
DeliciousSteak's picture

So it's basically world war 2 again? A resource hungry rising power desperately needs more to satisfy its increasing hunger and turns to the biggest resource storage unit on the planet. And then, subsequently, turns on it to gain control of the resources instead of buying them. And of course the anglosaxons, or khazars or whoever you want to believe, come just in time to pick the ripe fruit.

Wed, 04/09/2014 - 11:13 | 4639285 Herd Redirectio...
Herd Redirection Committee's picture

One man's Khazar is another man's Zionist (is another man's kleptocratic fascist).

Wed, 04/09/2014 - 11:06 | 4639259 HerrDoktor
HerrDoktor's picture

As a Khazar, I already speak both. Hebrew and Arabic too.  BTW, that is the answer to the Y6.15 million question.

Wed, 04/09/2014 - 11:17 | 4639297 pies_lancuchowy
pies_lancuchowy's picture

buy a yarmulke. 

That opens many doors.

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