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The Dollar v The Yuan: The decisive battle begins
#1
The Dollar v The Yuan: The decisive battle begins

http://rusdozor.ru/2015/10/10/dollar-i-y...j-sxvatke/

Quote:The ruble continues to appreciate rapidly - for the first time in the last two months of a course back to the mark of 60 rubles to the dollar. However, the cause of the continued strengthening of the ruble, it seems, is no longer the recovery of the cash flows of our corporations, and problems in the dollar itself.

The stock exchange is the US, which recently, during Obama's speech to the UN General Assembly, I almost started to uncontrolled fall down now show such signs of growth, what we have not seen as much in 2012.

What does this mean? Are attempts to re-translate the printing press in the afterburner mode has already led to a splash of dollars beyond the financial bubbles and launched the mechanism of uncontrolled inflation? For example, the estimated cost of medical care for retirees increased for the year in the United States by as much as 11%.

Are we soon see the logical conclusion of a carefree Fed policy?

Strongly doubt. Look, for example, Ukraine. Immediately after euromaidan it became clear that Ukraine is doomed to bankruptcy. However, the National Bank held more than six years: Ukraine defaulted covered only a few days ago. At the same time, despite the slide into default, from the standpoint of the layman Ukraine looks quite a hearty: trams, the TV is on the way to work, you can buy a cup of coffee.

Moreover, the hryvnia is how to bury the course in 22 hryvnia per dollar, and you can even buy more of this course a little real dollars. Importers, of course, forced to buy currency at the gray schemes and for a different price, but apparently it looks yet quite decently.

But the US financial system by several orders of magnitude larger than the Ukrainian. Inertia accumulated enormous, and it would be quite naive on our part to thrust a finger into each another crack colossus with feet of clay and the profoundly declare "Well now, that's exactly everything." The process of destruction of empires happen quickly just by historical standards, for us, the contemporaries of these exciting events, everything will happen very slowly.

The US government has just crossed the Rubicon, writes the meantime international investor Simon Black (Simon Black). This article talking about another clumsy US aggression, which is very unfortunate coincided with the launch of China's analog SWIFT - the system CIPS (ILAC). That translated my article Mr. Black:

In 49 BC defiant Julius Caesar stood at the Rubicon river in front of his army and took an important decision in his life. Roman law was strictly forbidden generals to withdraw its army from the country and lead it to Rome. The boundary of the province was the Rubicon.

«Alea iacta est! (the die is cast), "said Caesar, and sent his army across the river right in civil war. The phrase "crossing the Rubicon" is held in our lexicon for over two thousand years, indicating a risky and dangerous point of no return.

This week's decision to cross the Rubicon was adopted by the US government.

In a fit of boundless arrogance, a federal judge ruled that it has the "jurisdiction" over one of the largest banks of China, Bank of China (BOC), and the Bank of China is obliged to provide to the American court its financial statements.

The judge hearing the case, luxury brand Gucci excited against alleged Chinese criminal group that sold fake handbags in the United States.

It is alleged that the defendants Chinese send their income obtained by criminal means back to the Bank of China, China. And the judge wants information on the movement of money in their accounts.

Most of the shares of Bank of China, as you can guess, is owned by the Chinese authorities. Thus, the requirement of a judge (not a request) is a direct challenge to the sovereignty of China.

The only lever which is at the disposal of the judge, is that the Bank of China has a branch in New York; is officially licensed in the US bank. And if the Bank of China refuses to comply with the judge, the judge could theoretically require that the license of the Bank of China to work in the United States has been withdrawn.

Once again, the United States is using its financial system as a weapon.

Since the US dollar is the most widespread in the world's reserve currency, each bank in the world need some access to the US banking system.

Whether you're in London, Riyadh, Sydney or Shanghai, the most widely traded commodities, bonds and financial contracts default nominated in US dollars. Much of the global trade is conducted in dollars.

Thus, the banks do not just have to keep at US dollars, they also need access to the US banking system to be able to receive and transfer dollars for its clients.

Major international banks have so-called "correspondent accounts" or "nostro" with US banks. Thus, the largest bank in Denmark, for example, may have a correspondent account at JP Morgan or Citibank in New York to carry out with the help of dollar transactions.

And sometimes, foreign banks may even get its own banking license United States, as did, for example, the Bank of China.

But if the bank will be banned in the US banking system, it will be very difficult to keep the dollars and carry out any operations in dollars. And, therefore, the bank will be very difficult to engage in global trade and global financial transactions.

This leverage gives a huge advantage to the United States, and Americans have this lever for the reason that the US government enjoys enormous trust the rest of the world.

However, the US government has repeatedly proved that it is willing to abuse that trust and use their advantage as a weapon, which is even more powerful than the weapons that are available to the Pentagon.

Just last year, the US Treasury fined French bank BNP Paribas at a whopping $ 9 billion just for the fact that the Bank conducted business with unpleasant for Americans to countries such as Cuba.

Of course, now the situation has changed, the United States and Cuba are now best friends. But I doubt that the Americans want in the near future to compensate the French penalty. And, of course, if the French BNP refuses to pay, the French States may threaten to evict them from the financial system.

It's amazing how States came with its own ally. Now they set their sights on China, its main rival.

The Chinese, meanwhile, are already working on a parallel competitive financial system. They created AIIB Bank to compete with rudimentary IMF and the World Bank. And they are already close to the creation of international payment systems and clearing network that can compete with SWIFT and the US financial system.

This system is called CIPS, ILAC, China International payment systems.

After ILAC working, we will surely notice a rapid increase in the volume of financial transactions in yuan around the world. Transactions, which is now common to use dollars. Aggressive behavior of Americans in relation to the Bank of China gives the Chinese authorities even more reason to keep using the ILAC financial war against the United States.

Reducing the demand for dollars will totally destroy the last remaining advantage of America. If they will not be able to force the rest of the world to use the US banking system, they will not be able to get the rest of the world or keep dollars or to buy US government debt.

This will significantly weaken America.

When future historians will be writing chronicles the decline of the United States, of course, there will be the head of the US government's bad habit of constantly abuse the power entrusted to America world banking community.

Of course, Julius Caesar, too, has not learned this lesson.

Having crossed the Rubicon, he won the heavy civil war, and soon the Roman Senate named Caesar dictator for life. However, only a few weeks after his final victory, he was killed by the people who brought him to power - because they feared that Caesar would abuse this power.

Источник: http://rusdozor.ru/2015/10/10/dollar-i-y...j-sxvatke/
© RusDozor.ru

The US government just crossed the Rubicon

by Simon Black on October 8, 2015

http://www.sovereignman.com/trends/the-u...con-17506/

October 8, 2015
Caracas, Venezuela

Quote:In 49 BC, a defiant Julius Caesar stood in front of his army at the River Rubicon and made the biggest decision of his life.

It was strictly forbidden by Roman law for a general lead his army out of its province and into Rome. And the Rubicon marked the boundary.

"Alea iacta est!" (The die is cast!) he said, and led his army across the river into civil war.

The phrase "crossing the Rubicon" has stuck for more than 2,000 years, signifying a risky and dangerous point of no return.

This week, the United States government crossed the Rubicon.

In a fit of complete arrogance, a federal judge ruled that he has jurisdiction' over one of the biggest banks in mainland China, Bank of China (BOC), and demands that the bank turn over financial records to his court.

The judge is hearing a case brought by the luxury brand Gucci against an alleged Chinese counterfeiting ring for selling fake handbags in the United States.

The claim is that the Chinese defendants are sending their ill-gotten gains back to Bank of China in the mainland. And the judge wants to see their account activity.

Bank of China, as you can probably guess, is predominantly owned by the Chinese government.

So it goes without saying that this demand (not a request) is a direct affront at China's sovereignty.

The only leverage the judge has is that Bank of China has a branch in New York City; it is officially a licensed bank in the US.

So if Bank of China doesn't comply, the judge could theoretically order that their US license be revoked.

Once again, the United States is using its financial system as a weapon.

Since US dollars are the most widely used reserve currency in the world, every bank on the planet needs some access to the US banking system.

Whether you're in London, Riyadh, Sydney, or Shanghai, the most widely traded commodities, bonds, and financial contracts in the world are primarily denominated in US dollars.

Plus most global trade takes place in US dollars.

So not only are banks forced to hold US dollars, they require access to the US banking system in order to clear and settle US dollar transactions.

Large international banks have what are known as correspondent bank accounts' or nostro accounts' with US banks.

So a big bank in Denmark, for example, may have a correspondent account with JP Morgan or Citibank in New York in order to facilitate its dollar transactions.

And sometimes foreign banks may even apply for their own US banking license, as in the case of Bank of China.

But if a bank were to be kicked out of the US banking system, it would be incredibly detrimental to its ability to hold and transact in US dollars. And hence quite difficult to participate in global trade and finance.

This financial leverage is an unbelievable advantage for the United States, and is a result of the rest of the world placing a great deal of trust in the US government.

But the government has shown time and time again that they are willing to abuse that trust and use their advantage as a weapon one that is more powerful than the US military.

Just last year, the Treasury Department fined French bank BNP Paribas a whopping $9 billion for doing business with countries that the US doesn't like, such as Cuba.

Of course, Cuba and the US are BFFs now. But I doubt BNP is getting a refund anytime soon.

And naturally, if BNP didn't pay up, the US could threaten to evict them from its financial system.

It's simply amazing that the US did that to its own ally.

Now they're going after China, its biggest competitor.

The Chinese are already working on a parallel, competitive financial system.

They set up the Asian Infrastructure Investment Bank to compete with the vestigial IMF and World Bank.

And they're nearing completion on an international payment system and clearing network to compete with SWIFT and the US financial system.

It's called CIPS.

And once it's up and running, there will likely be a rapid increase in the worldwide use of China's currency for financial transactions transactions that used to be executed in US dollars.

Sticking it to Bank of China like this only gives the Chinese government even more reason to wage war on the US financial system through CIPS.

The reduced demand for US dollars completely destroys America's last remaining advantage.

If they can't force the rest of the world to use the US banking system, then they won't be able to force the rest of the world to hold US dollars or buy US government debt.

It weakens America considerably.

And when future historians write the history of the decline of the United States, there will no doubt be a chapter on how the US government made it a matter of national policy to consistently abuse the power entrusted to them by the global banking community.

Of course, Julius Caesar didn't learn that lesson either.

After crossing the Rubicon, he won a long civil war, after which the Roman Senate made him dictator for life.

And fearing he would abuse it, he was assassinated just a few weeks later by the very people who entrusted him with that power.
"There are three sorts of conspiracy: by the people who complain, by the people who write, by the people who take action. There is nothing to fear from the first group, the two others are more dangerous; but the police have to be part of all three,"

Joseph Fouche
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#2
A case of arrogance killing the golden goose, I think.
The shadow is a moral problem that challenges the whole ego-personality, for no one can become conscious of the shadow without considerable moral effort. To become conscious of it involves recognizing the dark aspects of the personality as present and real. This act is the essential condition for any kind of self-knowledge.
Carl Jung - Aion (1951). CW 9, Part II: P.14
Reply
#3
This is a common phase in commercial litigation. American companies, including banks, face similar jurisdictional risks if they do business abroad.

Just my opinion, we'd all be better off with greater transparency.
"All that is necessary for tyranny to succeed is for good men to do nothing." (unknown)

James Tracy: "There is sometimes an undue amount of paranoia among some conspiracy researchers that can contribute to flawed observations and analysis."

Gary Cornwell (Dept. Chief Counsel HSCA): "A fact merely marks the point at which we have agreed to let investigation cease."

Alan Ford: "Just because you believe it, that doesn't make it so."
Reply
#4
Drew Phipps Wrote:This is a common phase in commercial litigation. American companies, including banks, face similar jurisdictional risks if they do business abroad.

Just my opinion, we'd all be better off with greater transparency.

Where you have a bank that is a de facto government bank then there are additional considerations, I think. Usually the State Department gets involved and waves its magic wand and the law case goes away.

I once was involved in a LA class action lawsuit against the Vatican bank concerning WWII gold plundered from Yugoslavia by Ante Pavelic and his Ustashe, which was laundered through the Vatican. The State Department stepped in after the Vatican saw that it was going to lose the case and waved it's wand and the lawsuit went bye-bye due to diplomatic considerations.

For me, protecting a friendly power that helped out some of the worst nazi fellow traveller who perpetrated terrible atrocities and escaped punishment by fleeing to the west along the Vatican Ratlines together with their loot thanks to the criminal laundering of the IOR bank speaks volumes. That the State Department hasn't waved its wand in this case, likewise speaks volumes.

Just my opinion too. A level playing field for all or none for all, I think.
The shadow is a moral problem that challenges the whole ego-personality, for no one can become conscious of the shadow without considerable moral effort. To become conscious of it involves recognizing the dark aspects of the personality as present and real. This act is the essential condition for any kind of self-knowledge.
Carl Jung - Aion (1951). CW 9, Part II: P.14
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