China Takes Aim At The Petrodollar

 

China continues to pursue its ambitious plan to make its currency—the yuan—more international.

The world’s top crude oil importer and key oil demand growth driver is now determined to get as many oil exporters as possible on board with accepting yuan payments for their oil.

China is now trying to persuade OPEC’s kingpin and biggest exporter, Saudi Arabia, to start accepting yuan for its crude oil. If the Chinese succeed, other oil exporters could follow suit and abandon the U.S. dollar as the world’s reserve currency. Pulling oil trade out of U.S. dollars would lead to decreased demand for U.S. securities across the board, Carl Weinberg, chief economist and managing director at High Frequency Economics, tells CNBC. Weinberg believes that the Chinese will “compel” the Saudis to accept to trade oil in yuan.

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The Rise of China as a Superpower

Shanghai, China (ISTOCK.COM/LIUFUYU)

 

 

It is one of the most impressive economic and political miracles in modern times. And it isn’t over yet.

China is a sovereign state with a population of over 1.3 billion people. The nation possesses the world’s largest economy by some measurements, the world’s largest population and the fourth-largest territory.

These are the building blocks of a superpower. While the world anticipates China gaining superpower status, analysts debate over when and whether its rise will be peaceful.

The Trumpet forecasts that China will continue to grow as a formidable power, combining its strength with Russia. Further, we forecast that it will play a major role in waging economic war that will devastate America.

Where do these forecasts come from? Continue reading

De-Dollarization & Disintermediation – Russian Mobile Phone Operator Issues First Blockchain-Backed Bond

 

For months now Russia has been moving into the blockchain space in a serious way. I’ve talked about these moves in previous articles(herehere and yes, even here)

But, the latest news is one that should have every one stand up and take notice.

Russian Mobile phone operator, Megafon, issued RUB500 million in zero-coupon blockchain-based bonds recently. This was purely a proof of concept issuance. Continue reading

Rival investors seek to stop Chinese takeover of Chicago Stock Exchange

In December 2016, the Committee on Foreign Investment in the United States approved the CHX deal. But in August, the SEC delayed action on the purchase and has offered no timeline for when it will make a decision. | Getty

 

A group of U.S. investors hoping to buy the Chicago Stock Exchange is lobbying Congress to torpedo a rival, Chinese-backed acquisition proposal that is stalled at the Securities and Exchange Commission.

Lobbyists representing “Exchange Capital LLC,” a special-purpose entity for a private-equity investor group, said they helped generate a Sept. 26 letter led by Rep. Robert Pittenger (R-N.C.) to the SEC raising “serious concerns” over the CHX acquisition. Continue reading

Venezuela Publishes Oil Prices in Chinese Yuan, Snubbing the ‘Tyranny of the Dollar’

 

Could this trend lead to the erosion of the dollar’s reserve-currency status?

On September 15, Venezuela began to publish prices for its oil in the Chinese yuan rather than in United States dollars, following President Nicolás Maduro’s promise earlier in the month to rid the South American country’s economy of the “tyranny of the dollar.” News emerged on September 13 that Venezuela was telling oil traders that it will stop receiving or sending payments in dollars.

The Venezuelan Oil Ministry published a statement about the decision to publish prices in yuan, saying, “This format is the result of the announcement made on September 7 by the president [Maduro] … that Venezuela will implement new strategies to free the country from the tyranny of the dollar.”

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The World Is Creeping Toward De-Dollarization

The issue of when a global reserve currency begins or ends is not an exact science. There are no press releases announcing it, and neither are there big international conferences that end with the signing of treaties and a photo shoot. Nevertheless we can say with confidence that the reign of every world reserve currency has to come to and end at some point in time. During a changeover from one global currency to another, gold (and to a lesser extent silver) has always played a decisive role. Central banks and governments have long been aware that the dollar has a sell-by date as a reserve currency. But it has taken until now for the subject to be discussed openly. The fact that the issue has been on the radar of a powerful bank like JP Morgan for at least five years, should give one pause. Questions regarding the global reserve currency are not exactly discussed on CNBC every day. Most mainstream economists avoid the topic like the plague. The issue is too politically charged. However, that doesn’t make it any less important for investors to look for answers. On the contrary. The following questions need to be asked: What indications are there that the world is turning its back on the US dollar? And what are the clues that gold’s role could be strengthened in a new system? Continue reading

A “Financial H-Bomb” Has Exploded

 

Somebody exploded an H-bomb last week, and it wasn’t North Korea. It was the U.S.

This was not a kinetic H-bomb, the kind that leaves a mushroom cloud.

It was a financial H-bomb. Continue reading

Jim Rogers Warns “If Trump Starts A Trade War With China, It Will End US Hegemony”

This is exactly what Global Geopolitics mentioned just a five days ago. The tables have turned on the global playing field and the traditional options once thought to be useful to use against China will now backfire. America will now have to get more creative to once again get ahead in controlling the narrative when it comes to using leverage against its adversaries.

Adding to this, China is likely waiting for such a move to happen, which will benefit the nation in numerous ways:

  • China is a master in state propaganda, will successfully claim it’s the victim of a U.S. economic attack and rally support throughout the nation.
  • China, through provocation, will have produced a reason to retaliate. The trade war begins.
  • Retaliation will be successful due to the weakening of the U.S. positions and strengthening of Chinese leverage. World-wide, this will cause people and nations to question America’s ability to act and standing as the lone global superpower. If the Dollar goes down, the U.S. goes down with it.

 

 

Following Treasury Secretary Mnuchin’s threat that the US could impose economic sanctions on China if it does not implement the new sanctions regime against North Korea:

“If China doesn’t follow these sanctions, we will put additional sanctions on them and prevent them from accessing the US and international dollar system, and that’s quite meaningful.”

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Oil Rich Venezuela Stops Accepting Dollars

Source: The Burning Platform

 

  • President Maduro ‘ Venezuela will create a basket of currencies to free us from the dollar,”
  • Oil traders ordered to stop accepting U.S. dollar in exchange for crude oil
  • Order comes following calls from Russia and China to find alternatives to current reserve system
  • U.S. Dollar accounts for two-thirds of global trade
  • Venezuela has over ten-times more oil than United States
  • Super powers are gradually turning to gold to avoid using world’s main reserve currency
  • Are we seeing the beginning of the end for the U.S. dollar?

The oil-rich country of Venezuela has stopped accepting the U.S. Dollar as payment for oil.

Last week President Maduro warned that the country would this week ‘free’ itself from the US dollar. Continue reading

China’s New Gold-Backed Oil Benchmark to Deal Blow to U.S. Dollar

ISTOCK.COM/SELENSERGEN

 

New financial instrument gives oil-exporting nations their long-sought alternative to the petrodollar.

China will soon introduce a crude oil futures contract denominated in yuan and convertible into gold, the Nikkei Asian Review reported on September 1. Analysts say that since China is the world’s largest oil importer, the move could deal a major blow to the global influence of the United States dollar.

The contract would allow oil exporting nations such as Russia, Iran and Venezuela to conduct sales in yuan, instead of in U.S. dollars, and to then change the yuan into gold on both the Hong Kong and Shanghai exchanges. This would also allow these countries that often fall afoul of American foreign policy to circumvent dollar-based U.S. sanctions.

The Chinese government has been developing the gold-backed futures contract for years, and Oilprice.com reports that it is expected to launch this year. It will be China’s first commodities futures contract available to foreign entities, and analysts expect many oil-exporting nations and firms to find it appealing. Continue reading

America’s Weapons: “The Dollar and the Drone”

 

It was said that “the guinea and the gallows” were the true instruments of British imperial power.

The guinea represented the coined wealth of Great Britain.

The gallows represented its… constabulary zeal in policing restless natives.

This is the 21st century of course… a time of enlightenment.

Today’s instruments of imperial power are no longer the guinea and the gallows.

No. Today’s instruments of imperial power are “the dollar and the drone.” Continue reading

US Threatens To Cut Off China From SWIFT If It Violates North Korea Sanctions

While this sounds like a step that needed to be taken, and it is, it’s too little too late. China (and Russia) have created an alternative to SWIFT. Thus, cutting China off only means it will switch to its own and abandon the U.S. Dollar system — with Russia likely to join. In effect, it will end up hurting the United States more than the intended target(s).

Over the last decade China and Russia have feverishly worked around America’s global influence. Russia and China no longer need GPS, as they have their own indigenous satellite navigation systems — Europe, too. You’ll only do their militaries a favor if you cut that off. Control over the internet has been ceded by America, so there’s also no method or means of punishment there. The IMF has been undermined by the AIIB, so it’s also hard to do anything there as well.

America’s choices are limited and not as effective as they used to be. The joke may be on the U.S. should push come to shove. The alternatives set up only mean America will likely isolate itself should it choose punitive measures.

 

In an unexpectedly strong diplomatic escalation, one day after China agreed to vote alongside the US (and Russia) during Monday’s United National Security Council vote in passing the watered down North Korea sanctions, the US warned that if China were to violate or fail to comply with the newly imposed sanctions against Kim’s regime, it could cut off Beijing’s access to both the US financial system as well as the “international dollar system.”

Speaking at CNBC’s Delivering Alpha conference on Tuesday, Steven Mnuchin said that China had agreed to “historic” North Korean sanctions during Monday’s United Nations vote. “We worked very closely with the U.N.  I’m very pleased with the resolution that was just passed.  This is some of the strongest items.  We now have more tools in our toolbox, and we will continue to use them and put additional sanctions on North Korea until they stop this behavior.”

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China Makes It Easy

If Japan wanted to go nuclear, it could do so within three months time or less.

 

 

Steve Bannon is right.  China is the main event, North Korea is a sideshow. Nevertheless, one of the poorest nations on the planet has decided that its heart’s desire is to have a weapon system that can land one or more nuclear weapons on U.S. cities. Sometimes you are best served by ignoring the absurdity of the situation and concentrate on intent, because people crazy enough to put a lot of effort into something they don’t need might, on a whim or a mood swing, decide one day to use it. Continue reading

Opinion: Why is the EU so vindictive about Brexit?

Michel Barnier, the European Union’s chief negotiator for Brexit, says the British are going backwards in exit talks with the EU.

 

Voluntary withdrawal from the EU treaty does not have to be painful

In case you’re wondering where the belligerent spirit went that pushed Europe into centuries of warfare, two major conflicts last century, numerous regional skirmishes in recent decades, and a Cold War lasting nearly half a century, rest assured it is alive and well, albeit channeled into a “peaceful” version in the European Union’s remorseless vindictiveness.

After brutalizing Greece for lying to join the euro and then daring to violate the strictures of membership, the EU has now turned its focus to punishing Britain for having the audacity to reject the stifling bureaucracy of Brussels and the increasingly assertive dominance of Berlin. Continue reading

Dear President Trump: America is in for a Rude Awakening in January

 

Over the last couple of years I’ve been all over TV… from Fox News to CNBC, CNN and Bloomberg. I’ve been telling our fellow Americans that the financial global elite was planning to issue their own globalist currency called special drawing rights, or SDRs.

And that those elites would use this new currency to replace the U.S. dollar as the global reserve currency.

I’m sure some people in the mainstream media thought I was out of line — but the United Nations and the International Monetary Fund (IMF) have both confirmed this plan to replace the U.S. dollar is real. I’ve made this warning many times, but it seems to be falling on deaf ears. That’s why I’m writing directly to you.

Here’s the proof that the U.S. dollar is under attack, right in front of our eyes:

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