“The Art of War” was an ancient Chinese text written by General Sun Tzu some 2,000 years ago. The exact timing is not known but historical scholars have narrowed its origin to sometime between 200 BC and 200 AD. The book is written in 13 different chapters, some of which I will fast forward and compare to Chinese actions in current day. The text has been translated into several languages, first into French in the late 1700’s and again into English about 100 years ago. After reading many of the quotes, I have no doubt that Sun Tzu was a very wise tactician of Eastern thought and someone that even the “masters” looked to for guidance.
Sun Tzu believed that wars were inevitable and there would always be winners and losers both physically and economically. Interestingly enough, one of his main themes was that if a war had to be fought, it should be done swiftly and thoroughly because no one benefitted from a long and drawn out war. Before going any further and describing any of the chapters to you, please understand that there is a definite difference between the “Eastern and Western mindsets” in many facets of life. Sun Tzu’s “The Art of War” is certainly one of the early reasons for this difference.
Chapter 1: “The Calculations” speaks to the planning phase and learning all that you can about your opponent and as many of the surrounding conditions as possible.
Chapter 2: “The Challenge” looks at war from an economic standpoint, what are the costs versus the potential gains.
Chapter 3: “The plan of attack” speaks to five critical parts that are essential to win a war, Attack, Strategy, Alliances, Army and Cities.
Chapter 4: “Position” teaches the importance of holding ground until a push forward can be done safely and that it is most important not to give your enemy(s) an opportunity to exploit.
Chapter 5: “Energy” goes into the importance of creativity in the guidance of forces and the timing of movements.
Chapter 6: “Illusion” offers insight to opportunities created by the moving parts and by any weaknesses of your opponent.
Chapter 7: “Engagement” warns of the dangers of direct engagement especially when it is not of your choice.
Chapter 8: “The Variations” stresses that one needs to be flexible because unforeseen change makes this necessary.
Chapter 9: “Movement” describes the various possibilities an army may find when invading and the importance of knowing your foes intentions.
Chapter 10: “Positioning” speaks of 6 different types of ground positions, the pros and cons of the variations.
Chapter 11: “Nine terrains” is a focus on commanding forces through nine common situations.
Chapter 12: “Fiery attack” offers advice to weaponry and the use of your foes environment as a weapon. It also speaks to the response to a foe using your own environment as a weapon against you.
Lastly, Chapter 13: “Intelligence,” this chapter tells of how important good and real information is.
For anyone wishing to read the 1910 translation by Lionel Giles M.A., the full text can be found here.
In order to tie this thought process together with current times, I thought it might be a good thing to offer a few short quotes from the text and relate them.
Two of the most famous quotes are “The supreme art of war is to subdue the enemy without fighting” and “Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win.” In my opinion, China is currently “living” these two quotes almost verbatim. They have sat back for the last 15+ years and watched as the U.S. mortgaged their future, spent past goodwill and savings (gold in particular), and generally become weaker financially, spiritually, economically and militarily. I don’t believe that China wants any bullets to fly, I believe that they would be happy if there was no bloodshed but I also think that they are aware that the probability is quite high. As for my opinion of the first quote, China hopes that the U.S. defeats itself. The second quote, China is and has been planning the defeat of the U.S. since the days of Mao, he knew that the best way to defeat a foe is to debase their currency. How better than to let your foe debase their own currency?
Two other well-known quotes are “There is no instance of a nation benefitting from prolonged warfare” and “Move swift as the Wind and closely-formed as the Wood. Attack like the Fire and be still as the Mountain.” These quotes speak to China’s knowledge that any war must be swift and that they are costly in not only economic terms but in terms of life. Please do not forget, war is not just a physical or military undertaking, it is also an “economic” undertaking. I believe that the Chinese would like to strike swiftly from an economic standpoint when they finally pull the plug. They will demand delivery of all sorts of COMEX products, particularly gold and silver. They will default on many derivatives and leave the Western banking system holding the bag. Oil and resource contracts will be triggered where the flow moves East as opposed to West (think Saudi Arabia and others here). The wholesale dumping of U.S. Treasuries and dollars will also be a distinct possibility. And as you know, the prices of gold and silver will be marked up and away from the grasp of “buyers” who finally “get it” but just a little bit too late. Of course, the flow of manufactured goods and even necessities that we no longer produce in the U.S. will cease. In short, we will economically be put into a vice grip overnight.
One last quote for you and this one I believe is very pertinent, “When you surround an army, leave an outlet free. Do not press a desperate foe too hard.” I would equate this to the current and common saying that “desperate people do desperate things.” This as you know by some of my recent writings is a great fear of mine and I believe also a great fear of the international community. The actions or should I say “reactions” by the U.S. to losing power is of the greatest importance and unfortunately of least certainty. No one really knows exactly what the U.S. will do or how they will respond to various situations because policy has become “reactive” at best. From what I have been able to see, I believe that the U.S. has had “intentions” of war over both Syria and Ukraine, the only reason this has not happened in my opinion is because of the “chess” like maneuvering of the Chinese and Mr. Putin.
The above quote is pertinent because I believe that the Chinese (and Russians) would like to allow the U.S. a “graceful” fall from grace so to speak. If the U.S. would accept the reality that we are no longer the manufacturing giant of the world and that our standard of living needs to decline, it could be done peacefully. We need to accept the fact that the dollar is over printed and overvalued and that foreigners wish to change the reserve currency status.
Will we? Will the American people accept it? How about our government? Sad to say, I don’t think so. I don’t think that Washington can in any way accept being pushed into 2nd or even 3rd world status and I don’t believe the population will take it sitting down either. As for the populace, this would mean a dollar that is worth only .50-.60 cents of today’s current dollar literally overnight. It would mean that life’s savings are devalued overnight. It would mean that current paychecks would in many cases no longer support life. It would mean that “subsistence” payments like social security, welfare and food stamps would no longer support life. Sadly, I see those who saved and also those who did not, rising up in anger with no “out” or recourse other than starting over or going to work.
If you can see things in this manner then you can understand why it is so important to have savings and investments out of the system and available. There is a “side door” available to those wishing to exit. China has been using this exit for years, following their lead is wise because in my opinion they will soon head the group “making the rules.” By the way, the Chinese understand “paper money” and the hazards attached to it. They invented paper money and I believe have blown up more paper currencies than any other country, they already know the fate of the dollar.
I like getting different perspectives on things and happened on Martin Armstrong’s piece a few days ago. He said despite mismanagement and high debt, etc., the US dollar securities would remain a prominent place for global reserves/sovereigns to park money simply due to it being the only currency of sufficient size. Currency has to go somewhere when nations are in financial peril, and there is no outlet anywhere close to replacing the dollar. I’m sure he would agree that the trend is away from the dollar and that at some point the dollar will die, but he would note that it is years away. He also thinks things will accelerate downhill around 215.75 (9/15), and that gold bugs are right, it’s just that they have been early. It is all in the timing…
I meant to edit the above to emphasize Armstrong’s view that the relative size and depth of dollar denominated, publicly traded securities alone will give the dollar a prominent role going forward.
I believe he is wrong, there is enough of anything if it is “priced” high enough.
The BRICS nations and their alliances with other countries are not doing anything to the USA. They are artfully allowing us to do it to ourselves. They have given our politicians and corporations IMMENSE amounts of rope with which to hang themselves.
As more and more manufacturing has left this country due to greed (prices haven’t dropped because manufacturing costs have dropped, if no one has noticed) as the jobs have left and the technology has left, all the other countries have benefitted and America, as a whole, has dug itself a huge hole and is now falling into it.
Watch out for the banana peels!
Oh but china HAS done something to us! They have kept their currency out of international trade for decades, allowing for a permanent undervaluing of it. This has artificially sucked manufacturing away from the west, except from Germany which benefits from a Euro currency that is too undervalued for Germany’s manufacturing output. It’s all a rigged game based on currency manipulation. And the US has rigged its currency higher. Both China and the US elites have waged war on the American middle class for the last few decades!
undervaluing your currency is simply part of the planning “the art of war” right?
Andy Schectman gave an excellent interview the other day with Wall St. for Main St. Why wasn’t it posted in the blog area?
maybe they did not send us the link? I will get it posted.
Sun Tzu said in his book “Make your plans in the quiet of the evening and not in the heat of battle”.
too many are reacting and not planning. If a new economic program and rewritten tax law were implemented then stocks would rally another 20% and gold, silver and the like would drop by 40% or more. The FEAR trade would be gone and Art Laffer and Reagan would be right.
yes phil, and Unicorns would dance on rainbows while eating skittles!
Bill one problem with “starting over or going back to work” as you mentioned is that “what work is there to back to?” Mybudget360.com reported that 16 million folks have dropped out of the work force or gone to part-time work since 2000. This is also why over 50% of U.S. citizens receive a Government check or subsistence. So, Tennessee Ernie Ford’s song “I owe my soul to the company store” could be sung today by replacing “company store” with “federal government”. It don’t look good for the people of these United States.
Yes, maybe I should have just used the word “survive”.
Check out the Labor Force Participation rate for the past ten years.
Ponder it in light of the discussion above.
Stop dreaming and get real.
smoke and mirrors.