China announces the death of the $US — how does this affect your money & your life?
Last week Zhou Xiaochuan, the head of China’s central bank, announced, in a jargon-filled interview, that China would no longer be pegging its currency to the US dollar. Instead, the Chinese yuan will be linked to a broad basket of currencies, Zhou said.
This seemingly mundane shift could trigger a collapse in the US dollar, which, as economist Peter Schiff put it “will be the single largest event in human history.”
With all due respect to Mr Schiff, we would suggest it could be the single most important event in living human history, simply because it may not be as huge as the Dark Ages or the Black Plague (who knows? It could be). This event could be the single biggest trigger event of the 21st century, and effectively wipe the USA out of their long-held position as the world’s economic super power.
Most people alive today cannot remember the vast magnitude of the British Empire, with landholdings around the world so widespread that “the sun never set on the British Empire”. Its massive accumulation of wealth, weapons and peoples made it an imposing force, and it was “Rule Brittania” for a long long time… until, then, it wasn’t.
Just like the Roman Empire, and every other empire before it, the British Empire fell. It fell quickly and it fell hard. Weapons turned to rust, landholdings disappeared, morphing into newly independent countries, wealth dried up and the party was over for the British elite.
Watch closely as this “death of an empire” now happens to the USA.
The collapse of the USA, the dropping of the US dollar and the emergence of China as the world’s number one economic and military power, was predicted in 2005 in the book “Who’s Taking Your Money? (and how to get some of it back!)”. Written two years before the GFC (only predicted by a handful of people in the world), the book foretold of house prices dropping, sharemarket crashes, and advised readers where to invest when prices go south for the winter. It also gave a key to predict further rises and falls in the market, which is just as applicable today as it was in 2005. Watch what happens next, as your money will be affected.
The balance of payments is out, meaning the US spends more than it earns (and has for decades)
In the USA, around 84% of the US workforce is in the service sector (banking, government, retail etc.), meaning they do not actually make or produce anything of substance. In other words, the Americans do not make enough stuff to export or sell, to pay for the stuff they are getting from the rest of the world. The corporate propaganda media still cling to the lie that the US is the world’s biggest economy and China is number two. That is outright fiction.
The Chinese, for example, produce 11 times more steel than the US and, in the last 3 years alone, have produced more concrete than the US used during the entire 20th century. The Chinese have decided enough is enough and demanded real payment for their goods, not the rapidly devaluing (monopoly money) US dollars.
The significance of the shift has been underlined by the double digit collapse in world trade in January and the shutting of US ports. Chinese exports in January fell by 11.2% year on year while imports fell 18.8%. Most of this was related to the US. The message was clear, the US was not going to be allowed to pay for Chinese goods with money printed out of thin air.
This Chinese move is what prompted US Corporate Government Presidential spokesperson Barack Obama to ask Chinese elders and the Rothschild bankers for permission to devalue the US dollar, which was later denied.
The failure to get permission to devalue the US dollar prompted Obama’s handlers to call an unscheduled emergency summit meeting of ASEAN heads of state last week in California.
In fact, the real meeting that took place in California was between General Joseph Dunford, head of the US military and General Mulyono, chief of staff of the Indonesian armed forces. The purpose of this meeting was to discuss gold, lots of gold, according to US based Pentagon sources and Indonesian based CIA sources. As a result of this meeting, the US was given the right to finance itself by exporting gold to China from the gigantic Freeport McMoRan mine in Papua. According to the CIA source, the gold ore is turned into slurry and pumped straight into ships that take it to Hong Kong for refining. The amount is unknown but it is apparently enough to keep the US government functioning; for the time being.
At this same meeting the US military was given permission to develop a massive new platinum and gold deposit and set up bases on Indonesian islands near the South China Sea. The Indonesians will get a large piece of the action, plus protection, in exchange for their cooperation, the sources said.
The bigger story behind all of this is that the US military has been building a global military alliance to make sure we do not end up with a one China world.
On February 11th, before the meeting with the Indonesian army chief, General Dunford met with the heads of the Japanese and South Korean armed forces, ostensibly to discuss “North Korean missiles.”
The real point of the meeting was to ensure the Japanese and Korean armed forces aligned with the Russian, US and European military alliance that was sealed on February 12th, according to White Dragon Society sources.
This alliance, in addition to keeping China in check, is aiming to straighten out the Middle East. On that front Obama was instructed to tell the world that Saudi Arabia has nuclear weapons. The message being sent, according to Pentagon sources, was that it would be OK for the Russians to use nuclear weapons to attack Saudi Arabia. There is also a secret understanding that NATO will not defend Turkey if Russia attacks, the sources say.
The Turks and the Saudis, along with their allies in the Ukraine, have assembled an army over a million strong with up to 3500 tanks, over 3000 high performance aircraft and advanced missile systems.
They also have at least 200 nuclear weapons supplied by Israel, the USA or stolen from NATO arsenals in Turkey. This army has been assembled to create an Islamic super state or caliphate. This state is intended to include Northern Africa, the Middle East and large parts of central Asia.
Although the army is ready as far as weapons go, the forces are not. The Turkish and Saudi military brass have told their US counterparts they will overthrow their political leaders if the leaders try to order them to use this vast army in a suicidal move against the US/Russian military alliance.
Saudi Arabia and Turkey are also feeling a financial pinch respectively from drops in oil prices and drops in trade and tourism. This pinch forced Saudi Arabia to cancel $4 billion worth of military aid to Lebanon, according to Pentagon sources. The losers in this case were the weapons manufacturers and arms dealers, the Pentagon sources said. In addition, the Iranian aligned Hezbollah is being armed by Russia and, the sources say, “may act as a proxy for Russia to nuke Israel.”
Bottom line it for me: what’s the scoop?
- The USA spends more than it earns, has done for years, and is printing an endless supply of money to pay its debts; much like Germany did in the 1920’s and Zimbabwe did in the noughties.
- The US dollar is becoming increasingly worthless, and China does not want its currency linked to one which it sees will ultimately drop or fail.
- The USA will use its military strength to defend itself from “economic attack”, just as it has waged wars in the Middle East, not for peace or democracy, but for oil, gold or other resources.
- Remember that the USA found *zero* Weapons of Mass Destruction when they invaded Iraq, but around $130 billion of gold and currency was seized by the invading forces.
- The USA has proven again and again that they are happy to start wars, or join the wars of others, to increase their profits or power, and to increase arms sales.
- It’s all about the money, and the power, and the money…
What should I do?
If you have investments which are held in the USA, or denominated in US dollars (oil, gold, fiat currency, bank accounts etc), then you may consider changing them sooner rather than later. When the US dollar drops, it will happen quickly; just as the stock market crashes very fast, and the recovery tends to be slower.
If you’re considering buying property in the US as an investment, consider that this may be like buying extra tickets on the Titanic. Perhaps look to an economy that is not $60 Trillion in debt (with the majority of the debt owed to China). You can buy property in a stable or emerging economy just as readily, and you may sleep better at night.
Ten years ago, “WTYM” suggested to exit the US property market, exit the US stock market and look towards investing into Australia and China. History has shown you would have been far better off following the advice back then, and now, the clock is ticking faster towards the same conclusion.
Stay safe. Invest wisely.