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EQ News | Thursday April 20, 2017

The Global Reset and Sino-Russian Contingency

The gravity of allegations against the Fed colluding with the influential Goldman Sachs has left the average American resigned and apathetic. Consider how the two remained in cahoots over an institutionalised scheme to transfer wealth from the government [TARP] to their pockets & major mainstream US Banks should be cause for alarm. Yet average Joe Americans remain sanguine, no doubt more concerned with just paying the bills, or happily busy fiddling their smartphones or watching trash on an LCD screen- still dazed in oblivion by entertaining themselves with all the new applications & technologies. Scandalous as it should be, when former bank employees continue to influence government policies – that allows a revolving door between big government and big banks to go back and forth; still thrives without remorse or culpability.

This complicity that we now call government corruption has given big business the upper hand to put pressure over small enterprises – and has created an artificial economic condition that has skewed the laws of supply and demand. But one can not go on continually manipulating economic conditions and denying the market to discover its “true” price and value. Markets have a natural tendency to “self-correct” – which has always allowed economic systems to ultimately adjust and function properly, the multitude of iniquities committed by the government with the major banks and big businesses will soon reveal itself begging for everyone [the taxpayer] to pay the price.

We have now built a global economy that is based on lies, imbalances and deceit – and one that is bereft of accountability. But soon enough, it will be very difficult to ignore the mounting cracks that have been papered over to allow this economic illusion to flourish. Look at China’s ghost cities and empty malls if this is any indication that they have manufactured more steel than needed - albeit oversupplying the world with cheap goods. Examine other countries’ debt to GDP ratio where even industrialised countries like the US, Japan and EU have been borrowing against the future, triggering huge deficits. (And American banks have also been complicit, such as Chase dumping loans to risky Latin American countries.) Borrowing money to pay interest is never good macroeconomic sense and will not stand to hold water.

We have no doubt that America is leading the whole world into economic collapse, and should all things fail, one day will be the very reset button that will crash what we have known of [corrupted] capitalism into ground zero. Make no mistake that this Great Reset, far worse than the Great Depression – will have all those illusionary gains of progress erased which will set us all back to where we should have started. Back to a “free market”, with no “Big Government” and big bank intervention – and where you have to pay a “real” price compared to the asset bubble we see now that feeds corporate greed.

And quietly halfway across the globe, we have two superpowers in an effort of economic cooperation that is seen to insulate their economies from America’s collapse and from the Big Reset. Last March 14, The Russian Central Bank opened its first overseas office in Beijing. And sometime March 22, the Chinese responded with the official opening of the Industrial and Commercial Bank of China (ICBC) in Moscow as a clearing house for the renminbi.

This new level of financial cooperation between China and Russia, one that creates a pool of liquidity for the yuan in Russia and the rubble in China – is indicative of an increasing attempt to de-link to the US Dollar. The increased bilateral trade has also solidified their national currencies vis-à-vis each other against volatile situations and Wall Street shocks.

Meanwhile, it is no secret that Russia, being the world’s 4th largest producer of gold after China, Japan and the US, is also advantageously positioned to become a major supplier of gold to China. On top of their clearing houses, this is also indicative that both countries continue to do be active buyers and sellers for these precious metals. It can only be surmised that aside from slowly decreasing their dependence on the US Dollar, both countries are seen as establishing an Eastern Gold Standard to further back and strengthen their currencies from any weakness in the global markets. And the fact that current prices in gold do not reflect this strategic tectonic shift may have their governments and some billionaires in the know –accumulating this precious metal on its weakness.