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China Moves To Further Marginalize Dollar: Offers CNY-Denominated BRIC Loans

Tyler Durden's picture




 

Today we observed how as the US is considering releasing crude from its Political, pardon Strategic Petroleum Reserve, China was doing just the opposite. Now, in a further step confirming that China is acting as a much more rational capitalist power, and is rapidly encroaching on the "reserve" status of the sacrosanct USD, the FT writes that China intends to extend renminbi loans to other BRIC nations in "another step toward the internationalisation of its currency." To those following the stealthy Chinese incursion into currency markets as a dollar alternative, this is not news: already we know that China and Japan have bypassed the dollar entirely and now engage in direct bilateral trade using JPY and CNY (even as most other nations in Asia have developed bilateral agreements to transact in a non dollar basis). This is merely the latest incremental step which will see China become the dominant player in the currency arena, and further puts to doubt the fate of the US Dollar as the default currency. Of course, the market will not acknowledge any of this until the developing (i.e., non-insolvent world) is transacting entirely with US intermediation. And at that point, the US will be merely another Zimbabwe case study, where it can print all the money it wants to fund its deficit, and the only ones who care will be wheelbarrow manufacturers.

From the FT:

The China Development Bank will sign a memorandum of understanding in New Delhi with its Brazilian, Russian, Indian and South African counterparts on March 29, say people familiar with their talks. Under the agreement CDB, which lends mainly in dollars overseas, will make renminbi loans available, while the other Brics nations’ development banks will also extend loans denominated in their respective currencies.

 

The initiative aims to boost trade between the five nations and promote use of the renminbi, rather than US dollar, for international trade and cross-border lending. Under 13 per cent of China’s Asia trade is transacted in renminbi, according to Helen Qiao, chief Asia economist for Morgan Stanley. HSBC estimates that the currency’s share of regional trade could swell to up to 50 per cent by 2015.

 

BNDES, Brazil’s development bank with a loan book about four times the size of that of the World Bank, and South Africa’s finance ministry said they expected a master agreement to be signed in New Delhi that would include the lending pledge, with details to be ironed out during a summit. “We will discuss the creation of structures and mechanisms for lending in local currencies in order to maximise economic and financial transactions between the countries that are members of the accord,” BNDES said.

 

CDB declined to comment. Other signatories will include Russia’s Vnesheconombank, Export-Import Bank of India and the Development Bank of Southern Africa.

Next up, China announces that it was only kidding about its gold holdings, which suddenly are reported to have doubled or tripled, and the trap will be officially srpung.

 

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Wed, 03/07/2012 - 17:17 | 2233540 SheepDog-One
SheepDog-One's picture

Taps for USD on the pipes and snare....alas, we hardly knew ye.

Wed, 03/07/2012 - 17:22 | 2233575 Pladizow
Pladizow's picture

There was also the story some time ago of China issuing bonds.

Why does the largest creditor nation in the world need to borrow?

Wed, 03/07/2012 - 17:26 | 2233593 Dr. Engali
Dr. Engali's picture

Why wouldn't you if the cost of borrowing is nothing? It's like 0% financing. I sure as hell ain't going to spend my money when somebody else will loan it to me for free.

Wed, 03/07/2012 - 17:28 | 2233607 Pladizow
Pladizow's picture

Sorry for not making my point more clear - the Chinese issued bonds to start getting the world accustomed to transacting in their currency.

Wed, 03/07/2012 - 17:58 | 2233719 Sean7k
Sean7k's picture

I would suggest that in order to become a reserve currency or to encourage trade in your currency- there has to be enough of it to trade in. Bonds allow for the creation of currency. If you create a big enough market for your bonds- bond markets can begin to trade in them as well. 

It has taken time for China to develop enough trade relationships to allow for the transactions to be in Yuan. This is the next step to break from the dollar peg, thus keeping the US from inflating its' currency's value. 

Having a substantial gold/silver backing and the selling of US treasuries will further cement their currency position. 

The US knows this, yet doesn't implement these types of policies. This is the better question- why? Where are the Elites taking the US ? If it was onto bigger and better things, we would have a better foundation for economic stability.

Wed, 03/07/2012 - 18:03 | 2233745 Pladizow
Pladizow's picture

There can be no NWO with a super power in it, i.e., crisis by design!

Wed, 03/07/2012 - 18:12 | 2233789 Sean7k
Sean7k's picture

C'est possible.

Wed, 03/07/2012 - 19:36 | 2234062 trav7777
trav7777's picture

there is no way either Russia, Brazil, or India need the CNY.

This is merely for each nation to trade in their own currency.  They aren't going to use the CNY as a fucking reserve.

Why the hell would Russia of all nations want or need the fucking yuan?  They have enough oil exports to demand trade in rubles and tell china to fuck off.  Brazil as well is an energy exporter.

Wed, 03/07/2012 - 19:47 | 2234088 cranky-old-geezer
cranky-old-geezer's picture

 

 

Actually there can be no NWO if the west's anglo white race bankers lose control of the world financial system. 

And that's what the east clearly wants to do, end the west's financial system dominance. 

To do that they must take the US dollar down from its world reserve currency status.  That's the biggest step, and the only step actually.  Once USD loses WRC status, that's it for America as a superpower.  The Euro and EU will collapse soon after (if it hasn't already collapsed).

Western anglo white race bankers know this.  They know their control is about to end.  They know USD is about to lose WRC status.

It's why they're looting everything they can now, and the looting wlll get worse leading up to USD collapse.

But the sheep don't know it.  Like many sheep here.  Like RoboTard and MDB and sheep like that who see nothing but stock market gains. 

They have no clue the bottom is about to drop out of the dollar.  

And by the way, Iran is the battlefield where western bankers prevail and maintain USD superiority, or lose and watch USD fall.

Thu, 03/08/2012 - 01:23 | 2234489 Questan1913
Questan1913's picture

Cranky-old-geezer,

 

Yes, game over soon regardless what happens to Iran.  If spread evenly over US society the loss of WRC status would drop our living standard by 25 percent roughly, but I do believe most of the losses will be concentrated within the elites of financealization fraud where the haircut will be horrendous.  I won't be shedding any tears.

Thu, 03/08/2012 - 00:06 | 2234704 trav7777
trav7777's picture

white anglos like Rothschild and the Fed board huh?

Wed, 03/07/2012 - 17:57 | 2233724 bbq on whitehou...
bbq on whitehouse lawn's picture

Careful sometimes what we think is free, just an't so. To use Mark Twain.

Wed, 03/07/2012 - 18:06 | 2233756 Dr. Engali
Dr. Engali's picture

Well that's true they just embed the cost someplace else.

Wed, 03/07/2012 - 17:24 | 2233585 Ruffcut
Ruffcut's picture

"Can't wait to shit a bric or two for some food, sir."

Wed, 03/07/2012 - 17:32 | 2233620 JPM Hater001
JPM Hater001's picture

Clever.  I see what you did there.

Wed, 03/07/2012 - 17:56 | 2233713 SilverRhino
SilverRhino's picture

That's a neat predatory trick too.   Price out loans in renmembi (artificially deflated currency) and when the time is right let the Renmembi appreciate like mad against other currencies.  Instant debt slavery for BRI countries.

 

Thu, 03/08/2012 - 00:08 | 2234706 trav7777
trav7777's picture

volumes on these bonds are infinitesimal.

Big nothingburger.  The yuan is NOT going to EVER be the WRC.  China will be forced to hold BRL to get commodities and RUB to get oil.  They will both hold each other in reserve.

Wed, 03/07/2012 - 17:17 | 2233546 Tsar Pointless
Tsar Pointless's picture

Wait - does this mean we will have a bang-bang shoot-'em-up war with China by EOM, too?

Wed, 03/07/2012 - 17:19 | 2233551 SheepDog-One
SheepDog-One's picture

I hope so! Im bored with these FED assclowns! Lets get some excitement and mushroom clouds goin here!

Wed, 03/07/2012 - 17:21 | 2233564 Tsar Pointless
Tsar Pointless's picture

You had me at "mushroom clouds", SD-One!

I wish I could quit you!

Wed, 03/07/2012 - 17:48 | 2233656 Koffieshop
Koffieshop's picture

Wait - does this mean we will have a bang-bang shoot-'em-up war with China by EOM, too?

No. Nobody is THAT stupid.

However it does make open war with Iran more likely. This news suggests the US is running out of moves fast as the ponzi is almost up. Invading someone who doesnt have working nukes sounds like the proper, desparate, last-resort move to me.

Wed, 03/07/2012 - 19:09 | 2233990 Iconoclast
Iconoclast's picture

Yep, added to that the USA underpin their fiat by stealing oil, kinda like an oil standard..

Thu, 03/08/2012 - 14:44 | 2236744 matrix2012
matrix2012's picture

 

Iconoclast, did you mean: THE STANDARD OIL GROUP ???

An interesting read below...

"Another thing that most people don't know about is the ROCKEFELLERS CONTROL OF THE STANDARD OIL GROUP which includes under their umbrella EXXON, CHEVRON, PHILLIPS, MARATHON, BP, AMOCO and others. They also control major American banks like Chase Manhattan, and others. They founded the TRILATERAL COMMISION and (through Mandell House) the CFR (COUNCIL ON FOREIGN RELATIONS). They set up fake "philantropist" foundations to fund organizations and causes that make them more money and further their globalist agenda as well as put up money for shills that feign opposition (Chomsky, Buchanan, Nader, Moore, various environmental groups, etc) but really subvert any real resistance to the new world order agenda. They and other uber capitalists even had a huge hand in funding the BOLSHEVIK REVOLUTION in RUSSIA and perpetrated the whole "cold war" hoax. I really could go on and on but I'll just leave you with those as a few examples. I mean forget about any "freemasons", "zionists", "jesuits" etc type of theories as to who is really pulling the strings. Just follow the money trail and you'll see that its the Rockefellers and a few other oligarchical families and cabals that are THE TOP OF THE FOOD CHAIN in creating this sick destructive NEW WORLD ORDER that is a conspiracy against ALL people, cultures and races. 

I had always been leery of Allen and his work because of his close association with the JOHN BIRCH SOCIETY (I think its open to debate but a lot of evidence points in the direction of the JBS being a shill/controlled opposition organization) but this book helped bring a lot of things into focus for me as far as deciphering the globalist agenda/conspiracy so I have new found respect for the man. GARY ALLEN should be held in high regard along with ANTONY SUTTON and EUSTACE MULLINS as people who did the leg work that exposed much about the NEW WORLD ORDER conspiracy that other writers are selling books and riding the coattails of."

 

Read over The Rockefeller File (1998) and None Dare Call It Conspiracy (1971) by GARY ALLEN here!

 

 

Wed, 03/07/2012 - 17:19 | 2233557 RSloane
RSloane's picture

It only makes sense for them to do this. I'm surprised it isn't happening at a much more frequent rate.

Wed, 03/07/2012 - 17:25 | 2233587 mayhem_korner
mayhem_korner's picture

 

 

"happening" or "being leaked"...?

Wed, 03/07/2012 - 17:34 | 2233627 JPM Hater001
JPM Hater001's picture

Mayhem you sage.  Are you suggesting the Chinese are doing something behind our backs?  With out head squarely up our ass you would thing we would see something.

Wed, 03/07/2012 - 17:42 | 2233652 RSloane
RSloane's picture

They've already negotiated contracts with countries not in BRIC to purchase goods, including minerals, using that country's currency. They're not doing anything behind anyone's back, we're just not paying attention.

Wed, 03/07/2012 - 17:43 | 2233659 mayhem_korner
mayhem_korner's picture

 

 

I see nothing!  I am not here!  I didn't get out of bed this morning!  (Sgt Schultz)

http://www.youtube.com/watch?v=UgcxGFmYyPs

Wed, 03/07/2012 - 17:20 | 2233560 robertocarlos
robertocarlos's picture

So sorry. This my garden now.

Wed, 03/07/2012 - 17:23 | 2233578 Pladizow
Pladizow's picture

Are you referring to ALL US farmland?

Wed, 03/07/2012 - 17:41 | 2233651 LawsofPhysics
LawsofPhysics's picture

Farmland is up 600% in some locations around us.  Sellers only accepting gold.  Those of us still in business will be all too happy to accept Gold instead of dollars for the next load of soybeans sent to China.  fucking bring it.

Wed, 03/07/2012 - 18:15 | 2233790 sethstorm
sethstorm's picture

Cut off China's (preferential) access to the US then, whether it be directly or through intermediary.

Wed, 03/07/2012 - 20:10 | 2234214 DanDaley
DanDaley's picture

No, they would be happy to nuke the left and right coasts but keep the midwest farm-belt as nice as possible.  After all, they have 75% more people to feed than the US and desertification is eating up China.  

The US is like the flirty virgin who walked into a BA biker bar and is now going to have to pay for her big mistake.

Thu, 03/08/2012 - 00:11 | 2234711 trav7777
trav7777's picture

China is like a skank with cancer and Hep C.  Have you seen their country?

They're incapable of nuking the east coast anyway at the present time.

You talk about desertification and now they're going to take us over?  They're too STUPID to not destroy their own country but wise enough to conquer us? 

We are going to starve them all to death.

Wed, 03/07/2012 - 17:21 | 2233566 Iwanttoknow
Iwanttoknow's picture

Can any one recommend a good online site to buy silver coins?The one i use will not sell less than 200 ozs.

Wed, 03/07/2012 - 17:21 | 2233572 tekhneek
Wed, 03/07/2012 - 17:24 | 2233584 Pladizow
Wed, 03/07/2012 - 17:45 | 2233663 Silver Dreamer
Silver Dreamer's picture

I highly recommend Provident too.

Wed, 03/07/2012 - 19:17 | 2234015 Iwanttoknow
Iwanttoknow's picture

Thanks a lot.

Wed, 03/07/2012 - 19:21 | 2234024 Iwanttoknow
Iwanttoknow's picture

Thanks a lot.Much appreciated.

Wed, 03/07/2012 - 17:24 | 2233580 Boston
Boston's picture

Also:

 

Gainesville Coins

Texas Precious Metals

Wed, 03/07/2012 - 19:17 | 2234017 Iwanttoknow
Iwanttoknow's picture

Thanks a lot.

Wed, 03/07/2012 - 17:28 | 2233605 Ruffcut
Ruffcut's picture

Hey, fucktard Iwannaknowhowtosuckballs, go figure it out you troll bitch from fuckville.

 

Wed, 03/07/2012 - 17:29 | 2233611 mayhem_korner
mayhem_korner's picture

 

 

...and for you, we recommend petmeds.com.  Seems you're a dose or two behind.

Wed, 03/07/2012 - 19:18 | 2234019 Iwanttoknow
Iwanttoknow's picture

Ruffcut, Take your meds on time.

Wed, 03/07/2012 - 17:29 | 2233610 Augustus
Augustus's picture

Ebay works well for quarters and half dollars that are not "collector" coins.  Very little to no premium over spot with little shipping costs.  Pretty good assurance that it is not counterfit and then made to look aged. 

Wed, 03/07/2012 - 19:19 | 2234020 Iwanttoknow
Iwanttoknow's picture

Thanks.

Wed, 03/07/2012 - 17:31 | 2233614 Winston Churchill
Winston Churchill's picture

Kitco.com

Fast,cheap,reliable.

Wed, 03/07/2012 - 19:23 | 2234031 Iwanttoknow
Iwanttoknow's picture

Thanks.I'm proud to consider ZH as my primary source of financial news.Also (most) Zhers are great people.

Wed, 03/07/2012 - 17:35 | 2233632 JPM Hater001
JPM Hater001's picture

No.  call my friends over at American Rare Coin in Bloomington, MN.  No sales tax if shipped out of state.

americanrarecoinstore.com (952) 314-6661   I have gotten very good service and competitive over spot.
Wed, 03/07/2012 - 19:19 | 2234022 Iwanttoknow
Iwanttoknow's picture

Thanks.

Wed, 03/07/2012 - 17:21 | 2233567 tekhneek
tekhneek's picture

Eventually they'll dump their foreign reserves to  short gold/silver at the COMEX meanwhile they acquire metals cheaper with their own confetti.

Oh wait, they've been doing that for years now.

Wed, 03/07/2012 - 17:21 | 2233570 SheepDog-One
SheepDog-One's picture

'Wheelbarrow manufacturing'....hmmm YES how hard can it be? WTF youve got some stamped metal and 1 wheel...and soon every american will be clamoring to get a new one! Thanks for that WINNING idea!

Wed, 03/07/2012 - 21:14 | 2234380 superflyguy
superflyguy's picture

"SheepDog wheelbarrows, buy yours and get a free bill organizer insert!"

Wed, 03/07/2012 - 17:21 | 2233571 chump666
chump666's picture

CNY as a inflation hedge?  PLease...

Wed, 03/07/2012 - 17:21 | 2233573 mayhem_korner
mayhem_korner's picture

 

 

The U.S. Mint is evaluating various In Hu We Trust designs.

Wed, 03/07/2012 - 17:23 | 2233582 Dr. Engali
Dr. Engali's picture

You don't need wheelbarrows for digital money. Just a bigger memory card.

Wed, 03/07/2012 - 17:26 | 2233596 Pladizow
Pladizow's picture

Bitcoin Bitches!

Wed, 03/07/2012 - 17:27 | 2233600 yogibear
yogibear's picture

A some time countries should refuse to trade in the US dollar. Ben Bernanke and the rest of the Fed governors will go down in history as the people that destroyed the US dollar.

Wed, 03/07/2012 - 17:37 | 2233635 Dr. Engali
Dr. Engali's picture

No Nelson Aldrich, Abraham Andrew, Frank Vanderlip , Henry Davidson , Benjamin Strong, and Paul Warburg will go down in history as the guys that started the downfall of the dollar. The Bernank is just the caboose.

Wed, 03/07/2012 - 17:41 | 2233645 NotApplicable
NotApplicable's picture

Yeah, it worked out well for Iraq, after all.

Wed, 03/07/2012 - 21:20 | 2234392 superflyguy
superflyguy's picture

Don't forget Libya..

Wed, 03/07/2012 - 17:31 | 2233617 global
global's picture

Is this reflective of China making annoucements after the fact again?  If they reduce their USD lending wouldn't that mean that they have an ever increasing pile of USD via their export based model? What do they do with that pile? Buy treasuries? GM? iPadn?

Or is their export based model now slowing so their USD lending has to slow?

Wed, 03/07/2012 - 17:41 | 2233649 Hugo Chavez
Hugo Chavez's picture

Trying to make a virtue out of necessity.

Thu, 03/08/2012 - 12:47 | 2236328 matrix2012
matrix2012's picture

It comes into my mind that China is gonna spend some fiat excess to accumulate some essential commodities...

BUY... BUILD... whatever she can afford and need in essence using the fiat excess while it still has value... 

Wed, 03/07/2012 - 17:35 | 2233631 Hugo Chavez
Hugo Chavez's picture

In the long run this will be good for the usa if countries quit suppressing their currencies by tying them, loosely or tightly, to a dollar trading range.

The dollar can fall and our industry becomes competitive again.

Our country lived beyond its means due to an artificially high dollar. We can all be emoloyed again and have a stable economy, but at a more realistic standard of living.

Wed, 03/07/2012 - 20:00 | 2234166 cranky-old-geezer
cranky-old-geezer's picture

 

 

The dollar can fall and our industry becomes competitive again.

Until it loses WRC status.   Then America is history.

Thu, 03/08/2012 - 09:14 | 2235495 The Real Fake E...
The Real Fake Economy's picture

well said Hugo

Wed, 03/07/2012 - 17:37 | 2233638 LawsofPhysics
LawsofPhysics's picture

Fine with me.  I guess I will ask for Gold in exchange for the soybeans we ship them instead of dollars.  Anyone seriously think China has not been printing? Moreover, why would they need to issue bonds if they are a true "creditor".  More paper-pushing madness.

Wed, 03/07/2012 - 17:39 | 2233642 Winston Churchill
Winston Churchill's picture

At the current rate of Chinese divestment of UST looks like its all

over for the $ bu Sept.2012.

The Chinese will get down to about !/2 trillion in UST s before everyone finally

catches on and pulls the plug.

Might be sooner if they've found a way to re-hypo those USTs.Probably use then as collateral

in the REPO market and convert to anything else.

Wed, 03/07/2012 - 17:51 | 2233686 holdingontomypants
holdingontomypants's picture

Somewhere recently I read China cashed in 100 Billion of treasuries. Looks like they don't like holding depreciating assets.

Wed, 03/07/2012 - 17:41 | 2233648 5880
5880's picture

wtf happened to es?

Wed, 03/07/2012 - 17:47 | 2233673 bullet
bullet's picture

june contract is front month

Wed, 03/07/2012 - 17:41 | 2233650 eddiebe
eddiebe's picture

When the dollar loses reserve currency status, we'll be living like peasants in China.

Wed, 03/07/2012 - 17:45 | 2233664 Hugo Chavez
Hugo Chavez's picture

Naah much better.

We still have a developed productive economy and lots of natural resources. Sure the standard of living will go down a bit, but not that far. We will still be well above brazil and argentina.

Wed, 03/07/2012 - 18:09 | 2233779 sethstorm
sethstorm's picture

Either way, we'll still be above China's living standard, given their lack of freedom.

Wed, 03/07/2012 - 18:41 | 2233875 Race Car Driver
Race Car Driver's picture

I junked ya for improper use of a <sarc> tag... you forgot it.

Wed, 03/07/2012 - 18:39 | 2233867 Race Car Driver
Race Car Driver's picture

Why wait? Get out of debt and start living like a peasant. Get ahead of the trend and be the envy of your friends and neighbors.

Wed, 03/07/2012 - 17:43 | 2233655 sablya
sablya's picture

The Chinese are excellent at long-term planning whereas we in the US can barely figure out how we're going to raise the debt ceiling next month.  The Chinese have obviously mapped out their entire plan but it will not happen overnight.  They've been working their plan for decades starting with lowering the yuan to suck the dollars out of the US.  They will continue to systematically dismantle the reserve status of the US dollar by accumulating massive amounts of gold, eventually floating their currency, selling bonds, etc.

We're like a stupid beast caught in the grip of a boa constrictor.  The death will not be quick but it is no less certain for that.  We owe too much to escape from their grip and Washington is simply depending on the good graces of the Chinese to treat us like they think we deserve.  But China is not about kindness or grace, they are about total domination on their own terms, and it is simply too late to do anything to stop them no matter what we do.

 

Wed, 03/07/2012 - 17:49 | 2233679 LawsofPhysics
LawsofPhysics's picture

Funny, japan did the same thing with respect to their currency and buying U.S. Debt.  Moreover, The Fed holds most of the the U.S. Debt and will simply buy more.  In addition, you really think the People's Bank of China has not been printing?  You are also predicting that their currency will rise in value once it floats, so how is that going to be a good thing for an export nation with 1.2 billion mouths to feed?

Wed, 03/07/2012 - 18:02 | 2233744 holdingontomypants
holdingontomypants's picture

Didn't Mexico peso increase by 10% against the dollar to 11 pesos? What does that say about the USD if Mexico currency is gaining that kind of strength? If China floats their currency I don't see it jumping up very much especially if they continue to purchase large amounts of gold along with what the are able to produce themselves. Wasn't the only reason the dollar gained it worldwide reserve status in 1935 due to the gold standard? I am betting China is moving towards that same goal except they will have the gold standard backing their currency. Just my humble 2 depreciating cents worth.  

Wed, 03/07/2012 - 17:53 | 2233695 Missiondweller
Missiondweller's picture

Borrow cheap CNY then watch them back their currency with the gold they're accumulating.

Europe will find themselves paying more as the currency appreciates. The polar opposite of us borrowing dollars from China then devaluing our currency.

Wed, 03/07/2012 - 18:06 | 2233697 JR
JR's picture

comment deleted

 

Wed, 03/07/2012 - 18:03 | 2233710 Rollerball
Rollerball's picture

Re*leasing strategic crud from Iraq, perhaps?  BIS will control the "flow".  

If real bulls in (the) China shop (were going to) change the paradigm, they'll stock Thorium (reactors) and electrolytes (water).   

Non-event -- we're still playing the same con-game, and Chinks ARE the armor.

Tibet is still prisoner, and CONformity a survival technique of/to the false(hood).

Wed, 03/07/2012 - 17:58 | 2233720 walküre
walküre's picture

Why would anyone accept the Mao fiat over the Rothschild's fiat is beyond me.

Both are equally fraudulent and not worth the paper they're printed on.

The only thing to take away from this is that China is going full throttle in financial warfare and imperialist exploitation of resource rich countries.

What is backing Mao's fiat? Barbie and rice? Ghost malls, ghost cities and Dollarama? Just when they've had to admit their growth was slower (technically they're in recession already), they are putting the CNY gun to the oil exporter's heads.

No difference between US vs. China central planning. Maybe the color of their coats.

Wed, 03/07/2012 - 18:07 | 2233763 sethstorm
sethstorm's picture

Nothing says that the US and EU wouldn't end up shutting out China economically, if not militarily, if things got bad enough.

Wed, 03/07/2012 - 18:11 | 2233786 trilliontroll
trilliontroll's picture
Rickards: Four Horsemen

http://www.youtube.com/watch?v=5Zb5qL5tMVA

worth watching

Wed, 03/07/2012 - 18:46 | 2233801 Gromit
Gromit's picture

Makes perfect sense for China, although new clients probably should not cooperate.

Everyone seems to concentrate on the asset side of the Chinese Central Bank, with its trillions of US Dollar investments. Remember that this is financed by CNY (or Renmimbi whatever) liabilities to Chinese entities. If China revalues the Central Bank suffers a potentially gigantic loss on its dollar investments.

Wed, 03/07/2012 - 20:09 | 2234210 cranky-old-geezer
cranky-old-geezer's picture

 

 

If China revalues the Central Bank suffers a potentially gigantic loss on its dollar investments.

Nope, they'll dump 'em first, then revalue.

Wed, 03/07/2012 - 18:40 | 2233870 besnook
besnook's picture

as long as the market gets zimbaweized so i can pay off my mortgage for pennies all is right in the world.

Wed, 03/07/2012 - 18:44 | 2233891 weyes1
weyes1's picture

Don't forget about the Windfall Tax.

They're not gonna let us benefit by any of this.

Wed, 03/07/2012 - 18:42 | 2233881 falak pema
falak pema's picture

BRIC defies the reserve currencies; the flight from pax americana construct confirms. It is the speed of change that is impressive, fed by Euro meltdown, and FED currency war. 

ME is now nexus both politically and monetary wise. How long will the petrodollar wall hold; Iran has already started the ball rolling. It is interesting to see at what pace Qatar converts its USD surpluses from gas sales into hard RE assets in France and UK. The Oligarchs of ME/Russia are now important in stabilising the RE minimarkets of London/Paris/Riviera/Geneva/Alpine hot spots. 

Question : Does anybody know how Dubai RE is faring in all this?

Wed, 03/07/2012 - 18:44 | 2233892 Gromit
Gromit's picture

Answer: Don't ask don't tell.

Wed, 03/07/2012 - 19:23 | 2234030 goose3
goose3's picture

I'm pretty sure that should read:

 

"transacting entirely WITHOUT US intermediation."

Thu, 03/08/2012 - 13:20 | 2236454 matrix2012
matrix2012's picture

goose has sharp eyes!

agree that it should read:

"Of course, the market will not acknowledge any of this until the developing (i.e., non-insolvent world) is transacting entirely WITHOUT US intermediation."

 

a newly defined meaning of DEVELOPING = NON-INSOLVENT

so far we still have in our terms: The Third World; The First World; The Under Developing; The Developing; The Developed...

 

Wed, 03/07/2012 - 20:11 | 2234216 chump666
chump666's picture

Lets take out CNY BRIC loans as the BRICS start to crunch.  China. The mind boggles.

wires:

007 GMT (Dow Jones) Brazil's central bank cut its benchmark Selic rate by 75 bps, topping expectations for a half-point cut as economic growth in the country slows.

 

Wed, 03/07/2012 - 22:16 | 2234492 Augustus
Augustus's picture

This reminds me of the report from last week that Iran was going to be trading with India and paying with Iranian currency.  Now what doe the Indians buy with that trash?  Iranian inflation rate is ?????  Indian inflation rate is ?????  good luck with clearing that out folks.

Wed, 03/07/2012 - 22:56 | 2234566 q99x2
q99x2's picture

Where are the non-compete clauses for using the dollar. They must have had them sign contracts that they would not take over caucasion Globalist agendas. No? 

No asian ancestery in the Rothschild, Morgan, Rockefeller, Bush or Harriman hierarchy?

Damn I guess we are going to have to pony up a little more at the pump, if there are any pumps, after WWIII.

Thu, 03/08/2012 - 00:18 | 2234724 Youri Carma
Youri Carma's picture

Zero: “Next up, China announces that it was only kidding about its gold holdings, which suddenly are reported to have doubled or tripled, and the trap will be officially srpung.”

If so it will become clear that the only ones who learned from Rickards financial wargames is China LOlz

Thu, 03/08/2012 - 02:09 | 2234967 Blkhat117
Blkhat117's picture

What? a gold backed-yuan? you say NOOOOOOO!

Thu, 03/08/2012 - 03:19 | 2235088 cnhedge
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