http://www.zerohedge.com/news/2013-11-08/guest-post-how-china-can-cause-death-dollar-and-entire-us-financial-system
( China focuses on throwing financial levers , russia handles geopolitical matters such as Iran and Syria........)
Submitted by Tyler Durden on 11/08/2013 19:59 -0500
The only minister not expected to attend is China’s Wang Yi. China is sending their deputy Foreign Minister in his place, according to Western diplomats quoted in the media.
Hearts and minds already lost by jihadist campaign financed , supported and assisted through training ( in part ) by the west - including the US ......
http://www.mcclatchydc.com/2013/11/08/207924/us-popularity-in-germany-on-a.html
( China focuses on throwing financial levers , russia handles geopolitical matters such as Iran and Syria........)
Guest Post: How China Can Cause The Death Of The Dollar And The Entire U.S. Financial System
- Australia
- Bank of America
- Bank of America
- Brazil
- Capital Markets
- China
- Citibank
- Debt Ceiling
- default
- Deutsche Bank
- European Central Bank
- Fail
- Federal Reserve
- France
- Germany
- Global Economy
- Goldman Sachs
- goldman sachs
- Guest Post
- Hong Kong
- India
- Iran
- Japan
- JPMorgan Chase
- National Debt
- Nomura
- Real estate
- Reserve Currency
- Saudi Arabia
- Too Big To Fail
- Trigger Event
- Yuan
Submitted by Michael Snyder of The Economic Collapse blog,
The death of the dollar is coming, and it will probably be China that pulls the trigger. What you are about to read is understood by only a very small fraction of all Americans. Right now, the U.S. dollar is the de facto reserve currency of the planet. Most global trade is conducted in U.S. dollars, and almost all oil is sold for U.S. dollars. More than 60 percent of all global foreign exchange reserves are held in U.S. dollars, and far more U.S. dollars are actually used outside of the United States than inside of it. As will be described below, this has given the United States some tremendous economic advantages, and most Americans have no idea how much their current standard of living depends on the dollar remaining the reserve currency of the world.
Unfortunately, thanks to reckless money printing by the Federal Reserve and the reckless accumulation of debt by the federal government, the status of the dollar as the reserve currency of the world is now in great jeopardy.
As I mentioned above, nations all over the globe use U.S. dollars to trade with one another. This has created tremendous demand for U.S. dollars and has kept the value of the dollar up. It also means that Americans can import things that they need much more inexpensively than they otherwise would be able to.
The largest exporting nations such as Saudi Arabia (oil) and China (cheap plastic trinkets at Wal-Mart) end up with massive piles of U.S. dollars...
Instead of just sitting on all of that cash, these exporting nations often reinvest much of that cash into low risk securities that can be rapidly turned back into dollars if necessary. For a very long time, U.S. Treasury bonds have been considered to be the perfect way to do this. This has created tremendous demand for U.S. government debt and has helped keep interest rates super low. So every year, massive amounts of money that gets sent out of the country ends up being loaned back to the U.S. Treasury at super low interest rates...
And it has been a very good thing for the U.S. economy that the federal government has been able to borrow money so cheaply, because the interest rate on 10 year U.S. Treasuries affects thousands upon thousands of other interest rates throughout our financial system. For example, as the rate on 10 year U.S. Treasuries has risen in recent months, so have the rates on U.S. home mortgages.
Our entire way of life in the United States depends upon this game continuing. We must have the rest of the world use our currency and loan it back to us at ultra low interest rates. At this point we have painted ourselves into a corner by accumulating so much debt. We simply cannot afford to have rates rise significantly.
For example, if the average rate of interest on U.S. government debt rose to just 6 percent (and it has been much higher than that at various times in the past), we would be paying more than a trillion dollars a year just in interest on the national debt.
But it wouldn't be just the federal government that would suffer. Just consider what higher rates would do to the real estate market.
About a year ago, the rate on 30 year mortgages was sitting at 3.31 percent. The monthly payment on a 30 year, $300,000 mortgage at that rate is $1315.52.
If the 30 year rate rises to 8 percent, the monthly payment on a 30 year, $300,000 mortgage would be $2201.29.
Does 8 percent sound crazy to you?
It shouldn't. 8 percent was considered to be normal back in the year 2000.
Are you starting to get the picture?
We need other countries to use our dollars and buy our debt so that we can have super low interest rates and so that we can afford to buy lots of cheap stuff from them.
Unfortunately, the truly bizarre behavior of the Federal Reserve and the U.S. government over the past several years is causing the rest of the world to lose faith in our currency. In particular, China is leading the call for a "de-Americanized" world. The following is from a recent article posted on the website of France 24...
For decades the US has benefited to the tune of trillions of dollars-worth of free credit from the greenback's role as the default global reserve unit.But as the global economy trembled before the prospect of a US default last month, only averted when Washington reached a deal to raise its debt ceiling, China's official Xinhua news agency called for a "de-Americanised" world.It also urged the creation of a "new international reserve currency... to replace the dominant US dollar".
So why should the rest of the planet listen to China?
Well, China now accounts for more global tradethan anyone else does, including the United States.
China is also now the number one importer of oil in the world.
At this point, China is even importing more oilfrom Saudi Arabia than the United States is.
China now has an enormous amount of economic power globally, and the Chinese want the rest of the planet to start using less U.S. dollars and to start using more of their own currency. The following is from a recent article in the Vancouver Sun...
Three years after China allowed the yuan to start trading in Hong Kong’s offshore market, banks and investors around the world are positioning themselves to get involved in what Nomura Holdings Inc. calls the biggest revolution in the $5.3 trillion currency market since the creation of the euro in 1999.
And over the past few years we have seen the global use of the yuan rise dramatically...
International use of the yuan is increasing as the world’s second-largest economy opens up its capital markets. In the first nine months of this year, about 17 percent of China’s global trade was settled in the currency, compared with less than one percent in 2009, according to Deutsche Bank AG.
Of course the U.S. dollar is still king for now, but thanks to a whole host of recent international currency agreements this status is slipping. For example, China just recently signed a major currency agreement with the European Central Bank...
The swap deal will allow more trade and investment between the regions to be conducted in euros and yuan, without having to convert into another currency such as the U.S. dollar first, said Kathleen Brooks, a research director at FOREX.com."It's a way of promoting European and Chinese trade, but not doing it with the U.S. dollar," said Brooks. "It's a bit like cutting out the middleman, all of a sudden there's potentially no U.S. dollar risk."
And as I have written about previously, we have seen a bunch of other similar agreements being signed all over the planet in recent years...
1. China and Germany (See Here)
2. China and Russia (See Here)
3. China and Brazil (See Here)
4. China and Australia (See Here)
5. China and Japan (See Here)
6. India and Japan (See Here)
7. Iran and Russia (See Here)
8. China and Chile (See Here)
9. China and the United Arab Emirates (See Here)
10. China, Brazil, Russia, India and South Africa (See Here)
But do you hear about any of this on the mainstream news?
Of course not.
They would rather focus on the latest celebrity scandal.
Right now, the global move away from the U.S. dollar is slow but steady.
At some point, some trigger event will likely cause it to become a stampede.
When that happens, demand for U.S. dollars and U.S. debt will disintegrate and interest rates will absolutely skyrocket.
And if interest rates skyrocket that will throw the entire U.S. financial system into chaos. At the moment, there are about 441 trillion dollars worth of interest rate derivatives sitting out there. It is a financial time bomb unlike anything the world has ever seen before.
There are four "too big to fail" banks in the United States that each have more than 40 trillion dollars worth of total exposure to derivatives. The largest chunk of those derivatives is made up of interest rate derivatives. In case you were wondering , those four banks are JPMorgan Chase, Citibank, Bank of America and Goldman Sachs.
A huge upward surge in interest rates would absolutely devastate those banks and cause a financial crisis that would make 2008 look like a Sunday picnic.
Right now, the leader in global trade seems content to use U.S. dollars for most of their international transactions. China also seems content to hold more than a trillion dollars of U.S. government debt.
If that suddenly changes someday, the consequences for the U.S. economy will be absolutely catastrophic and every single American will feel the pain.
The standard of living that all of us are enjoying today depends largely upon China. They can bring down the hammer at any moment and they know it.
http://news.antiwar.com/2013/11/08/iran-nuclear-deal-close-talks-extend-into-saturday/
Iran Nuclear Deal Close, Talks Extend Into Saturday
All But One P5+1 Foreign Ministers Head to Geneva to Join Talks
by Jason Ditz, November 08, 2013
Hopes for a nuclear deal emerging from the P5+1 talks with Iran in Geneva continue to grow tonight, with reports that the talks, which are extended into Saturday, will include 5 of the 6 P5+1 foreign ministers, as well as Iran’s Foreign Minister Javad Zarif.
The only minister not expected to attend is China’s Wang Yi. China is sending their deputy Foreign Minister in his place, according to Western diplomats quoted in the media.
There had been hopes for a deal made today, but the complexity of the matter made it clear another day was needed. Still, all those foreign ministers, along with EU foreign policy chief Catherine Ashton, presupposes that the talks are close to a breakthrough.
An interim deal is said to include Iran paring back parts of its nuclear program for six months in return for some sanction easing, though exactly how much remains to be seen.
Any such deal is going to face stark opposition from Israel, which has condemned the idea of deal and continues to push for more sanctions. As goes Israel, so goes it’s powerful lobby, and by extension much of the US Congress, so keeping the deal at least a little palatable to the hawks without being watered down to meaninglessness is going to be a challenge.
And of course Syria was Putin's master class ......
http://www.newsmax.com/Newsfront/rand-paul-obama-putin/2013/09/12/id/525288
http://www.theglobeandmail.com/news/world/on-syria-putin-runs-rings-around-obama/article14267559/
After two years of being blamed for blocking the road to peace in Syria, Russian President Vladimir Putin appears now to be in the driver’s seat while U.S. President Barack Obama is stuck on the passenger side looking for a map.
Obama administration officials argue that it was the U.S. threat of force that brought Russia forward with its proposal to place Syria’s chemical weapons under international control. But it appears that the prospect of Mr. Obama losing his bid for congressional approval of military action against Syria had a lot more to do with it, prompting Mr. Putin to throw him a lifeline.
For the Russian leader, it’s a chance to appear statesmanlike for a change, while still safeguarding his country’s own interests. Not only is Syria an old client state, dating from the time of the former Soviet Union, it also is an ally of Iran. Syria and Iran share the goal of keeping the Sunni jihadists out of Damascus.
Russia has the same goal. “Russia has had enough trouble with jihadists in Afghanistan and Chechnya and doesn’t want another jihadist state in the region,” said Adnan Abu Odeh, a former Jordanian diplomat.
Keeping the regime of President Bashar al-Assad in place in Syria also serves another Russian interest. A government friendly to Russia would prevent Qatar, the resource-rich Gulf state, from making good on its proposal to use Syria as a conduit for a gas pipeline to Turkey and on to Europe. Europe is a major market for Russian natural gas.
To make sure the threat of a U.S. strike against Syria doesn’t soon return, Russia has already insisted that any United Nations Security Council resolution that would authorize the destruction of Syria’s chemical weapons not include the threat of military consequences should the plan fail. U.S. and French diplomats have called for such a provision.
The decommissioning plan will succeed, Mr. Putin said this week, “only if the U.S. and those who support it on this issue pledge to renounce the use of force.”
“It is difficult to make any country – Syria or any other country in the world – unilaterally disarm if there is military action against it under consideration.”
Mr. Obama may have little choice but to accede to that demand. If this plan never gets off the ground, he may not find any more support in Congress than he had a few days ago for military action. After pledging to seek congressional approval to punish the Syrian regime for its alleged gas attack on civilians last month, Mr. Obama is also unlikely to launch a strike without that support.
Mr. al-Assad also appears to have emerged a winner, or a survivor for the moment. Mr. Obama, who declared back in 2011 that the Syrian dictator had to go, has said repeatedly since the Aug. 21 gas attack that he wants to carry out a limited strike on Syria to degrade its chemical weapons capabilities, not to effect regime change.
Members of the Syrian opposition have expressed bitterness that Mr. Obama’s latest position is only to declare war on Syrian chemical weapons, not on a regime that has killed tens of thousands of its own citizens by other means.
The new focus on diplomacy, and the Syrian government’s stated willingness to go along with the Russian plan, has left the main U.S. ally in the Gulf off balance. Saudi Arabia has been trying for a year to push the U.S. military machine into gear in support of the anti-Assad rebels in Syria.
The Saudis see themselves as the religious leaders of the Sunni Muslim world and, as such, have two goals, Mr. Abu Odeh said. The first is to stop Shia Iran from encroaching in the Arab world, and the second is to reduce the influence of the Muslim Brotherhood who oppose monarchies such as the House of Saud.
Mr. Obama disappointed them when he dropped his support of Hosni Mubarak in Egypt and then supported the Muslim Brotherhood leadership that replaced the Egyptian dictator. Now, he has chosen to pull his punches when it comes to Iran’s ally in Damascus.
“The Saudis see Iran’s Shia influence as the greatest evil,” Mr. Abu Odeh added, “greater than the threat posed by Israel or anyone else.”
That influence extends from Iran to its Hezbollah followers in Lebanon. “Syria is a lynchpin that connects Iran to its Shia followers in Hezbollah,” he said. “Pull out that pin and Iran’s forces become weaker.”
That is likely why Mr. Putin was willing to give up Syria’s chemical weapons – because it ensures that Mr. al-Assad or any succeeding pro-Iranian leader will remain in office.
Hearts and minds already lost by jihadist campaign financed , supported and assisted through training ( in part ) by the west - including the US ......
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Germans opinion of US falls sharply - and they haven't even focused on their stolen gold yet ?
U.S. popularity in Germany on a steep decline in wake of spy scandal
Posted by Matthew Schofield on November 8, 2013 Updated 11 hours ago
To most Germans, Snowden is a hero
BERLIN — Sheesh, spy on a few dozen million Germans and they really get angry.
A new poll by German public television (ARD) indicates that only 35 percent of Germans still see the United States. as a good partner. That figure has fallen 14 points since just this past July when about half of all Germans saw America as a partner they could trust.
The new poll, done Thursday, also indicates that 61 percent of Germans now see the United States as an untrustworthy partner.
The poll reflects the deep unhappiness in Germany over the spy scandal, which has seen outrage consistently build from the summer. The first reports were that a U.S. spy program was collecting phone calls and emails and social media communications of Germans. Last month it was alleged that they‘ve been tapping the personal cell phone of Chancellor Angela Merkel and that the top of the U.S. embassy in Berlin houses a big spy nest.
And it’s a steep decline in popularity here for a nation which since the end of World War II has seen the United States as a close friend, an essential ally, a protector and often a provider. To Germans, for decades, the United States was not just the ideal partner but an ideal.
The National Security Agency spy scandal appears to have torched that reputation, at a level beyond even that of the Iraq invasion split.
How steep is the slide in German feelings towards the United States?
Sixty percent of Germans consider Edward Snowden – former NSA employee and the man who exposed the extent of the American spy program in Germany and elsewhere and now a fugitive in Russia – to be a hero. That's right, the man American politicians call a traitor and officials say has done enormous damage to the United States is considered a hero here. A paltry 14 percent of Germans consider him to be a criminal.
As there is a move among several political parties to grant Snowden asylum, or even witness protection status, in Germany, these numbers could provide strong political cover.
And, meanwhile, President Barack Obama’s star appears to have morphed into a red dwarf here. In April 2010, a whooping 88 percent said they liked his politics. This week, that number had been cut in half, down to 43 percent.
The upside of the poll might be that the United States is still seen as more trustworthy a partner than Russia, but only just. Russia, which, remember, did impose communism on half this nation in the wake of World War II, was seen in the poll as an untrustworthy partner by 74 percent of Germans.
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