It seems that a big debate is now whether the U.S. would actually “go to war” should Russia try to annex Poland or other Baltic states. I see it a little differently and believe that we’ve been at war for quite some time now. We have been fighting an economic war, an energy war and a currency war for many years now. Just look at what Russia is doing in the Ukraine; they are “calling” loans and asking for payment of gas already supplied. China has called a $3 billion agro loan of their own with Ukraine. This is an example of Russia and China upping the ante or raising the bet to the West.
For the most part, these business deals were done based on British law. Were the U.S. to send “aid” to Ukraine…we would in effect be sending money directly to Russia and to China as they are first in line creditors. Do you believe that this is “by mistake” or was done inadvertently? No. Some of you may remember a picture taken of Mr. Putin holding a very large gold bar about 10 years ago…was this just a photo op? Everyone knows that China has been buying gold hand over fist; Russia has also been a steady buyer. Coincidence?
I could go on and on with these many “coincidences,” I won’t, my point is that they have mutually been preparing for the demise of the U.S. dollar. They have allowed (helped) us to divest all that we once had. We jettisoned our manufacturing base and China gladly stepped up to produce. This as you know was not an overnight process and took lots of time. “Time” has been on their side while it has been running out on us.
I really believe that Russia and China have a full and mutual understanding that they really don’t have to fire a single shot versus the U.S. All they have to do is wait. Wait for us to “save the world” some more with further QE. Wait for us to reach the “debt point” where it is simply too much. “Wait,” this is all that they need to do. Over the weekend, Tass reported that Managing Director/Chief Economist of Russia’s Sperbank said that the Chinese Yuan may become a 3rd reserve currency “in the future”…I would say yes, “given time” …or not much. I believe that this is not so much “pro” Yuan as it is a gentle nudge against the dollar.
In other news, “Venetians” voted by an overwhelming 89% to secede from Italy and form a new independent state. Where are President Obama, Joe Biden and John Kerry on this one? Why are they not all up in arms explaining to us that a move such as this is illegal? Where are the sanctions? It has been reported that plans are being made to no longer send tax revenues to Rome. This one will hurt as Venice paid far more than their share and received “benefits” of less than a third of what their payments were. Italy was already broke, now I guess you could say that they are “brok er!”
I find this interesting because the people are “using” democracy to their own benefit. Crimea’s vote was “illegal” because the outcome was counter to western interests. Had they voted to remain with Ukraine, the vote would have been applauded as democracy “at its best.” Now Venice, who’s next? There has been talk that Scotland would also like their full independence…will a vote even be allowed?
How about northern Californians or Coloradans? These two areas are primarily conservative or even libertarian who are now outnumbered and outvoted in liberal states. What would be the reaction from Washington was a vote to be scheduled? Would we maybe see SWAT teams sent in to destroy or confiscate voting machines? Were California and or Colorado to split into two parts each then we would then have 52 states and thus 104 Senators…how would these 4 extra votes fit into the current picture? They wouldn’t, that’s how.
The way I see this is that the “sides” are getting further apart globally from a political standpoint, let me explain. You see the “conservative/liberal” debate is taking place everywhere, (one of the best examples is France). Call it rich versus poor, income redistribution or whatever you’d like but it is happening and the divide is growing. I’m not talking about “the 1%” or even the .01% I’m talking about the growing divide between those who believe that if they work hard they should be able to keep the majority of their earnings and those who believe that everyone is entitled to part of the spoils. As a side note, each day on my way to riding I pass by a sign outside of a business that reads “taxpayers should get 2 votes.” I bring all of this up simply to point out the growing “divide,” most importantly from the “mental” or philosophical standpoint…so far.
To finish I’d like to remind you of the “meeting between presidents” a little over a year ago. It was reported that privately China spoke of a more “fair” distribution of wealth. What does this really mean? I take it to mean that the Chinese are no longer happy with the current rules where they produce and send real goods to us in exchange for a currency that we can freely produce (dollars). This “growing divide” will be remedied in a “reset” in my opinion. A reset which we will not preside over.