EDITOR NOTE: This month the news of the Chinese Oil-Gold futures contract was so important, of tremendous significance, that it dominated the report for content and implications. It means the death of the Petro-Dollar is occurring in real time. The news of the Shanghai contract launch had other important supporting events in occurrence also. As a result, no crypto currency developments are reported this month. But next month, the topic will be covered with some gusto.
## GOLDEN QUOTES
“Time is the school in which we learn; time is the fire in which we burn. Love is the most difficult and dangerous form of courage; courage is the most desperate admirable and noble kind of love.” ~ Delmore Schwartz (American poet and short story writer)
“Anyone who believes the Satanist Western bankers, who strive to wreck the earth's integrity and the global economy, are in control of the Chinese bankers and leaders, is a fool who ignores history and overlooks the anger held by Asians after a century of abuse and exploitation. China is not Russia. The White Dragons are not the Romanovs. Besides, no amount of seeding from David Rockefeller’s loins could change 5000 years of Chinese culture or alter their power structure with elite half-breeds.” ~ Carlton Confucius
“The globe is on the verge of tumultuous change and powerful disruptions. The King Dollar has been shown the door and must walk the plank, with certain further delays and extensions. Yet the outcome is known. The Dollar Era is ending with twilight and regional wars. The giant cluster fark is coming. The Petro-Dollar is dead in the East. The Gold Trade Note has a birth within view. Wars to defend the USD financial regime have run their course. The US and Israel have been exposed for creating and running the ISIS terror militias. The COMEX gold market is failing. The deficit in silver is at an historic level. The United States is alienating almost all its allies. The US-led fascist trade unions are dead on arrival. The USGovt sanctions against Germany over the Nord Stream II pipeline are the last straw in their strained bilateral relations. New sanctions against Iran dishonor the Iran Nuclear Deal, and make the USGovt out to be a rogue state. Turkey is splintering off NATO, which is exposed as a war machine, not a security alliance. NATO might be defunct upon the splinter and exposure. The Ukraine is coming to Europe seeking a solution, cutting out the USGovt in negotiations. Observe the rise of the Russian Oil Consortium or the NatGas Cartel, both to sell outside the USD trading system, thus burying the Petro-Dollar defacto standard. Nothing can stop the gas pipelines, to be built against the Washington wishes and their strong pressure. The OPEC oil cartel is dead useless, reduced to a bickering gaggle of disunity. The Arab oil monarchies are set to collapse on debt grounds. The USGovt must go begging to continue its debt parade, now over $20 trillion. The entire Washington political scene has become a Kabuki theater with clowns, spies, traitors, assassins, thieves, and demagogues dominating the stage. The entire USEconomy is due soon to be turned upside down by the lost global currency reserve, which not one in 100 Americans comprehends. The Global Paradigm Shift is finally arriving. Fasten your seat buckles.” ~ Jackass
“China never rests on its laurels, and China is always thinking ahead. As we reported recently, China plans to take control of the Eastern oil market, the world’s most dynamic oil market, control over which is likely to lead to China’s control of oil markets outside the East. It is a step that will lead to a gold-backed Yuan currency being widely used in trade, not just oil trading but trade in general, but throughout the East and possibly beyond. It is step that is in the process of launching Gold into an epic bull market as gold becomes the center of a new monetary order.” ~ Stephen Leeb
“The next big event will be the tolerated Dual Universe based upon a coexistence between the USD and RMB financial spheres. The USGovt and USMilitary cannot prevent it, since the Americans cannot go to war against both Eastern Superpowers. The King Dollar Court will be very hard to break, since so well entrenched (even though with widespread revolt) and defended by layers of derivatives (even though cracking in structures). It will take time, a long time, and it will succumb to the gold component in the new non-USD platforms. The USDollar and its attendant systems cannot compete against Gold, which will first appear in the gold payment system, as expected. However, the Voice advised to expect quantum shocks soon, which will bring more rapid change, as a result of more tested instruments hitting the stage. It is my firm opinion, though, that China & Russia do not want big shocks or rapid change, since both cause unintended consequences with unexpected damage. The Global Currency RESET is a slow creature to arrive on the geopolitical stage, but it will come. When it does, it will come with a golden banner, treading on discarded USTreasury Bond paper on the road.” ~ Jackass
“The global mayhem is another petard to obfuscate reality during the crash. Mayhem has been carefully escalated to coordinate with the RESET for quite a while and the RESET itself is already going on at an astonishing rate. We cannot even see a glimpse of the deepest level of manipulations constructed in the media. They are designed by the social engineers to be invisible to Joe Six Pack and his simple barnyard mind. The persistence of the US in continuing many of the current conflicts is an indication of the intensity of the RESET changes and their inevitability and the unviability of the current US hegemon template. The main players are staying the course with the script, while the deeper and more dynamic forces set in motion are exercising their predetermined agenda. Even the cryptos were a carefully timed event. The problem with it all is that the universe will have something immutable to say about it all, which will be the end of many of mankind's (elite controller) plots. There will always be a return to a balance, whatever the cost, but it too never endures in a dynamic universe.” ~ Sky Crane
“When Ray Dalio mentions that Gold makes an effective diversifier because the USDollar is a fiat paper that cannot be counted on, it rubs me the wrong way. The word DIVERSIFY used in conjunction with fiat paper and fiat-related items such as stocks and bonds seems to be funny, if not perverted. It is like prudence is advised to mix real money with your rubbish paper assets made of confetti. It is a silly concept as for justification. Would we be advised to mix fecal droppings with wholesome food at the dinner table? Best to reduce to absolute minimum the fiat paper-based assets, since they will suffer enormous losses.” ~ MontyD (Hat Trick Letter client from England)
“Notice how 256-bit encryption is standard on Bitcoin, yet for ten years or more 1024-bit encryption has been the standard for security. I believe that the blockchain is designed to coincide with the cashless movement. It is totally designed to track transactions across the board. It is not anonymous, and it is not secure. But on the upside, I think Bitcoin has spurred innovation which will eventually lead to fully autonomous and anonymous decentralized ledger systems that will truly re-invent the internet. We are in the Beta-Max stage and soon we will start to see the DVD, Blu-Ray levels of distributed privacy and transactions. Do not get too sucked into blockchain, as most likely a Langley operation.” ~ MichaelW (Hat Trick Letter client, and software developer)
“I just finished reading the Zero Hedge article entitled ‘Turkey Pivots from NATO; Signs Russia Missile Deal.’ You are to be congratulated. This has been a major call of yours for over a couple years, and it is played out just as you said it would. This alone is worth the price of your newsletter as it further strengthens your already solid credibility. I have no doubt that Germany will soon pivot towards Russia as you predict. It is interesting to see Venezuela (a mortally wounded country) refuse US dollars as payment for its oil exports. It is a sure bet that the Shanghai Exchange will be a life-line to Venezuela as it enables them to slowly rebuild their sovereign gold reserves. Kudos to you Sir!”~ JoeG (Hat Trick Letter client in Florida)
“Something is spooking the USDollar in a big way. It is different this time. We have central bank intervention. Not only is it a record amount, but for record length of time. We saw this after World War II, where they monetized $1 trillion. But it was for a decade. It lasted for a while. We are going on for a decade here. We do not know how fast this can unwind because they are so many bubbles in so many places. Where is your refuge? They talk about stock bubbles, but that misses the point. The biggest bubble possibly of all time is with the bonds. Countries in Europe cannot pay their sovereign debt. You can make the case that China, Japan, and the United States cannot pay their debt. That is why we have zero or negative rates. You cannot call this manipulation or rigged markets. They have cornered the bond market. That is why there are REPO problems in the bond market. Not enough bond collateral in there, because the central banks has bought them all. They are doing the same thing with stocks. The Swiss National Bank keeps buying the big US stocks, as they have something like $85 billion worth. But look what they are buying, the mega-cap tech stocks. They are buying Apple, Google, and Microsoft, which are each effectively convertible bonds. They have so much cash, if they start going to hell, all that cash makes their stock look like a bond. And of course if the stock goes up, they have the upside. This situation cannot be modeled. Nobody has ever seen this before.” ~ Bill King (Ramsey King Securities, author of The King Report, taken from interview with McAlvaney (HERE))
“In Costa Rica, the street signs say ‘calle sin salida’ which means street without exit, or in English simply DEAD END. It is probably the same in other Latin American countries. The sign belongs on the USDollar-based financial structures, to be sure. It is simple enough, but the lemmings continue to believe that the USD will continue forever, despite the fraud and abuse, despite the hegemony and skein of wars. They are deceived and delusional. The United States and its leaders (along with the sheeple) are up against the reality of the Rubin Doctrine. It states that we SURVIVE TODAY BY WRECKING TOMORROW EVEN IF MOST ASSUREDLY. But now we find ourselves staring at the abyss and it is tomorrow. The game is over, and neither leaders nor the lapdog press have the courage to say so. The events are unfolding fast. The lost global reserve currency status will bring with it a financial anaphylactic shock, worse than 50 bee stings on the macro body. This is not really the USD rug pulled out from under us, as it is the entire ground sinking like a massive Florida sinkhole. What comes next will be drastic, shocking, and highly disruptive. It is all part and parcel of the Global Paradigm Shift. The King Dollar is being deposed, and the departing king will not be shown much respect, not given any shelter in the East. To those who wonder why not, the answer is simple: The USGovt has not shown respect to the bondholders of USTreasury debt, neither to allies or to enemies.” ~ Jackass
“China announced their plans for implementation of the Gold-Yuan Oil contract for Shanghai, but not their timetable. Their action seems clearly intended to keep the US monkeys off balance. It amounts to a USD Death Warrant, with no execution on the warrant yet. The Petro-Dollar is effectively dead in the East. More non-USD instruments are to be rolled out, with more pushing the USDollar down death row corridor.” ~ EuroRaj
“Many ask who will eat the upcoming stock losses when the correction finally comes. This time the big banks and the USFed will eat some of it. To be sure, the Wall Street banks are setting up the big broad short positions, including with futures contracts, in order to mitigate the upcoming losses in a powerful stock decline. But do not expect it will be more than 10 to 12%, since more would frighten the sheeple masses. They will remain in the game if the decline is considered a standard garden variety correction. The decline should be 50% or even 60% to bring valuations in line with the lousy corporate picture and horrendous recession every year. In reality the USFed cannot let the stock market go out of control into heavy loss territory, because a pension catastrophe would be quick and vicious. Hundreds of millions of retirees without income would be a national nightmare, with chaos ushered in. The big factor holding up stocks continues to be corporate stock buybacks, and obviously the official QE illicit stock purchases. The company buybacks might slow down, but not the QE purchases. The public must understand that company buybacks are occurring while the executives are dumping in a big way, the data fully available on sites for tracking insider transactions.” ~ DonaldS (Hat Trick Letter client in Florida)
“Once the dollar is no longer regarded or used as the reserve currency, Third World poverty will engulf everyone in this country below the upper half percent wealth stratum, except those who possess a fair amount of physical bullion. I just bought more gold and silver coins from a friend yesterday, who had an uncontrollable urge to get their house painted and needed to sell some coins to me to fund it. It will not matter what the house looks like in a couple years, but they would never take my word on that. The level of assumed entitlement in this country by the middle class is absurd.”~ Investment Research Dynamics
“Most Americans do not worry about the value of their currency. Therefore they are not aware that if they visited Switzerland in 1971, they would have received 4.30 Swiss Francs for one dollar. Today they receive 0.94 Swiss cents. This is a loss of 80% in purchasing power against the Swiss Franc, since Nixon stopped the gold backing of the dollar. Currency moves reveal the economic (mis-)management of a country. The constant loss of value of the dollar against most other countries in the last few decades clearly depicts that the United States is on the road to ruin. The dollar tells the truth and it tells an ugly truth. The remaining days of the dollar as the reserve currency of the world are very limited. The world does not need a reserve currency and certainly not one which is in a chronic decline due to economic mismanagement. The days of the Petro-Dollar are coming to an end. China and Russia will see to that.” ~ Egon von Greyerz
“Bitcoin basically introduced a situation where we could bypass the money mules. In the beginning it looks very anonymous, and in the end it does not look very anonymous.” ~ Rickey Gevers (cybercrime specialist at RedSocks Security)
“I think the streets are going to be completely cleaned of Gold & Silver, and they are going to go NO OFFER. They will be bid, bid, bid, and higher, higher, higher, and there will not be any for sale. Gold & Silver will go into hiding until new currencies come out that can be trusted. I think that is where we are headed. You should buy it now because it is available. At some point in time, it is not going to be available, and you are either going to have it or you will not. The price will not matter. You will count your wealth in ounces.” ~ Bill Holter
“Man sacrifices his health in order to make money. Then he sacrifices money to recuperate his health. And then he is so anxious about the future that he does not enjoy the present; the result being that he does not live in the present or the future. He lives as if he is never going to die, and then dies having never lived.” ~ Dalai Lama
“We are on the verge of a global transformation. All we need is the right major crisis and the nations will accept the New World Order.” ~ David Rockefeller (the most influential American ever in the destruction of the national economy, its environmental integrity, its social fabric, its industrial base, its health, now cavorting with Lucifer, very glad gone along with Brzezinski)
“The United States was lost as global leader with integrity after the Kennedy kill by the CIA. The scapegoat of the Soviets was absurd and not the least credible. Next came the abandoned Gold Standard by Nixon, who was part of the assassination plot. Then came the rise to power of Kissinger, a pure Rockefeller agent who became more important than the president. He arranged the terms of the Petro-Dollar pact with the Saudis. He served further as the primary fascist figure in the 20th Century, complete with numerous secret trips to Argentina to visit his nazi leftovers in Bariloche. In the ensuing years, the lock on the Israeli leash to control the USGovt foreign policy was made firm via the Council on Foreign Relations. Fast forward 20 years to the 9/11 insider event, a kill shot of democracy, carried out by the same organization that removed Kennedy. It enabled installation of the Fascist State and its business model, as the Jackass calls it. Finally, the banker cabal guilty of the Kennedy kill, the fascist installation, the wars without end, and the kill to the twisted democracy (more like corporate oligarchy) has been led to the end of the blind alley. The global system finds itself suffering from debt saturation, disgust of immoral war, and a global revolt against the precious USDollar. The next era will see the fading of America, the rise of the East, and the return of the Gold Standard to global finance.” ~ MaxS (Hat Trick Letter client in Ontario, for the above cartoon, the 1947 dogwalker is Truman, the 1963 dogwalker is Kennedy, the NOW dog is fully loaded on a narcotics diet)
## GOLDEN POTPOURRI
◄$$$ CHINA COULD SOON PURSUE COMMODITY PRICING IN ITS OWN CURRENCY, IN ADDITION TO OIL… FIRST OIL IN TRADE, THEN ALL COMMODITIES IN DEFIANCE TO THE KING DOLLAR… IT IS A SLOW PROCESS, BUT ONCE BEGUN, IT GAINS MOMENTUM IN UNDERMINING THE USDOLLAR FOR ITS GLOBAL CURRENCY RESERVE ROLE. $$$
Central bank official says China is highly motivated to promote usage of the CHYuan in commodity pricing. The Beijing officials are studying market mechanisms in earnest manner. They are studying the “market rules and mechanisms of pricing commodities in Yuan to satisfy demand from domestic and overseas investors,” says Pan Hongsheng. He is deputy secretary general of the Peoples Bank of China’s monetary policy committee, quoted by the official China Securities Journal.
The comments by deputy Pan were made at an international oil & gas conference in Hangzhou, capital of the eastern Zhejiang province. They came as China is about to launch a Yuan-denominated crude oil futures contract in Shanghai that has been almost seven years in the planning. China aims for pricing power in launching crude oil futures. The contract would be the first priced in the Chinese currency, giving China a greater voice in the crude oil market traded in Asia. It is widely seen to be a step forward for Beijing in its bid to unseat the USDollar as the defacto commodity trading currency. The fight big battle is with crude oil, the center of the Petro-Dollar.
Considering that China has a leading role in the purchase of many commodities, the country had good economic foundations and strong conditions for broader price structures set in the RMB. China is the world’s largest importer of crude oil, iron ore, and other raw materials like coal, cement, and grains. Their one billion metric tons of iron ore bought last year represented over half of the total global seaborne trade, a truly astonishing figure. To put more commodities priced in Yuan would be beneficial for China not only in terms of giving the country more pricing power, but also as in gaining an effective foreign exchange mechanism for the currency. They would reduce costs and win the internationalization feature.
Zhang Jun is chief economist at Morgan Stanley Huaxin Securities in Shanghai. He stated, “Such a move would diversify trading entities and increase Yuan products to pave the way for a more market oriented exchange rate mechanism. It would help domestic firms to manage FOREX risks and would also boost the internationalization of the Yuan. It would not weaken the dollar’s dominance in the short term.” Ambitions run wild but reality bites. While Beijing would greatly wish to see the Yuan replace the USDollar in commodity trading, that is unlikely to happen anytime soon. They are not delusional with raw ambition. It must be understood that with much less trade payment and pricing done in USD terms, the global banking system will shed USTreasury Bonds in their reserves management. They will favor Chinese Govt Bonds which pay higher interest, and favor Gold bullion which offers greater integrity and stability.
The primary position the USDollar as global reserve within the monetary system is built on its widespread use in the pricing of commodities, led by crude oil transactions. It provides the United States with the leverage to influence countries that rely on exports of such goods. It is a position that Beijing would like first to eliminate, and later to usurp. The USGovt abuses the privilege in obscene staggering manner, by monetizing its $trillion deficits without economic consequence. The USGovt also facilitates $trillion bond fraud by its big banks, with total impunity. The US abuse has motivated a global movement to unseat and dethrone the King Dollar. The process is well along, having begun the global revolt following the initial steps of QE in 2012 and the Ukraine War in 2014.
China is once again trying to boost the Yuan global profile after its notable appreciation versus the USD this year. After major losses in 2016, the Yuan gained 2% against the greenback in August alone. See South China Morning Post (HERE). It is pathetic how many opinions of Chinese bankers, business executives, and economists are often dismissed by Western readers, since they have funny names. They make ten times more sense that the harlots who speak from Wall Street banks or the USGovt offices, who both lie egregiously for their paychecks.
◄$$$ DEBT RATING AGENCY MOVES INDICATE BOTH DESPERATION FOR THE WESTERN BANKER CABAL AS WELL AS DISUNITY… STANDARD & POORS JUST DOWNGRADED THE CHINESE GOVT DEBT BY ONE NOTCH… FITCH UPGRADED RUSSIAN GOVT CREDIT RATING FROM STABLE TO POSITIVE… MOODYS DOWNGRADED UKGOVT DEBT, IN THE STILL AFTERMATH OF THE BREXIT VOTE… THE UNITED KINGDOM HAS LEFT THE CABAL BUILDING, FREE TO JOIN LEGION WITH CHINA. $$$
The Chinese Ministry of Finance rebutted S&P Global Ratings decision to downgrade the country's sovereign credit rating, calling it a wrong decision. It smacks of a politically motivated move, very petty and obvious. S&P cut China's long-term sovereign rating by one notch to A+ from AA-, citing its increasing debt risks. The finance ministry called the justification perplexing, since the Chinese Economy has been on a firm growth track following its achievement of higher than expected growth rates in the first half of this year and solid progress in economic restructuring and debt cuts. Liang Hong, chief economist of the China International Capital Corp, said “S&P is behind the curve.” The country's economic fundamentals have significantly improved in the past two quarters, international organizations have gradually raised their forecasts of China’s growth, and the Yuan currency has been surprisingly strong this year. Clearly, the debt downgrade was ordered by the USDept State as part of petty trade war. See China Daily (HERE).
Fitch credit agency just upgraded Russia’s sovereign credit rating from stable to positive, even though it predicted that economic growth will be slow and oil revenues will not return to previous heights. Fitch cited a more flexible exchange rate, strong commitment to inflation targeting, and a prudent fiscal strategy, reflected in the recently approved budget rule. They expect improved macroeconomic stability due to robust external and fiscal balance sheets. See Russia Today (HERE).
Moodys has downgraded the UKGovt debt from Aa1 to Aa2, citing outlook stable, causing yet another sudden smacking to the British Pound. They cited weakened public finances, questionable fiscal consolidation plans, and an expected rise in the debt burden. They clearly are worried about the BREXIT implications in the near future. Expect individual bank downgrades should follow, while the LBMA is under pressure also. Look for more deals cut with China, to firm up the London Centre, which is under siege. The UK is free to cut more Chinese financial deals and build its ties, dislodged from the European Union, but now more independent in decision making. See Zero Hedge (HERE).
◄$$$ THE LOW OIL PRICE GUTS ANOTHER OPEC OIL EXPORTER WITH ALGERIA SUFFERING SIGNIFICANT INCOME LOSS… THE LOWER INCOME HAS RESULTED IN DRASTICALLY REDUCED FOREX RESERVES, BUT WORSE, A DECISION TO MONETIZE THEIR DEFICITS… WITNESS THE FIRST OPEC NATION TO GO NUCLEAR WITH THE MONETIZATION OPTION, IN A CERTAIN SUICIDE. $$$
The low oil price is slamming another OPEC oil exporter as it continues to liquidate its foreign exchange reserves. Algeria, like Saudi Arabia, has seen its international reserves plummet by 40% as the oil price fell in half since 2014. The story rhymes, the location differs, the result will be the same in a failed state. Algeria joined OPEC back in 1969 and is currently producing 1.1 million barrels of oil per day (mbd). While Algeria is not one of the larger OPEC members, it still exports roughly 670,000 barrels of oil per day. The country currently receives around $33 million in daily oil revenues. However, Algeria’s oil revenues have suffered a tragic decline. Their net oil export revenues fell from $61 billion in 2012 to a mere $19 billion last year. Thus, net oil export revenues fell nearly 70% in the past four years. This has ravaged the country’s financial balance sheet. To make up for declining oil revenues, Algeria has liquidated $70 billion of its international reserves since the end of 2014, down nearly 40% with more shedding of reserves to come. The oil price will not be rising in any recovery, not with Iran output coming online and not with a powerful Western Economy recession in progress (fully denied).
Unfortunately, the liquidation of the Algerian FOREX reserves has not been sufficient to reduce the ongoing budget deficits. They must be addressed. In response, founded in pure desperation, Algeria officially has launched a monetary policy commonly called helicopter money amidst a deep budget crisis. Algeria’s Prime Minister has decided to print money directly from its central bank rather than access debt via the international market via bond issuance as the Saudis have done. Thus, Algeria is now embarking on debt monetization, which history has shown to be a death sentence. The direct monetization bypasses commercial banks as a monetary intermediate. Printed money will cover their deficit, and their currency will plummet in due time. It will result in rampant price inflation and a wrecked economy in short order.
Their five-year plan presented by Prime Minister Ahmed Ouyahia aims to balance the budget by 2022, and reverse a deficit that ballooned with the plunge in global crude prices. They are delusional unless their cut their federal costs by half and end almost all subsidies. Not likely, as a tragedy awaits. Ouyahia stated, “If we turn to external debt, as the IMF suggests, we will need to borrow $20 billion a year to repay the deficit, and within four years we will be unable to repay the debt. This is what made the government look at non-traditional financing.” They have chosen a different sort of home-grown suicide, rather than imported suicide. The common outcome to both paths is national failure.
While other OPEC nations have been rumored to consider such a currency devaluation in the nuclear option, as response to oil prices that have fallen far below budgetary breakeven levels, none had yet chosen this deadly channel. They are on a death watch for a year or two. Other oil monarchies will fall, just like them, in just a matter of time under the weight of debt. Curiously, Algeria is the first OPEC member to select the drastic reckless option of outright unsterilized monetized debt. History shows no survivors in this option. The United States has used the same perverted option, and so far bought five years, with a distorted wrecked and debt saturated economy loaded with new subprime bubbles where half the nation is on welfare. Algeria will be extremely lucky to survive two years. See SRS Rocco (HERE) and Zero Hedge (HERE).
◄$$$ US-STATES ARE SHORT $645 BILLION IN OBLIGATIONS, PLUS THE PENSIONS… SLOWLY THEY ENTER REALITY AND SEE THE NIGHTMARE. $$$
Numerous states are gradually recording their proper obligations on costs for health care, debt repayment, and even their pensions. Like post-WWI German war reparations, the obligation is inflation adjusting. In other words, they rise as inflation smacks the cost structure. The ugly $645bn figure does not include the state pension shortfalls, which universally suffer from the lunatic rosy formulas not based anywhere remotely in reality. See Wall Street Journal (HERE).
◄$$$ AUSTRIA HAS SIGNED A LANDMARK FUNDING DEAL WITH IRAN… DITTO A BIG DANISH BANK WITH IRAN… THE GERMANS ARE COMING VIA THE BACK DOOR INTO THE EURASIAN TRADE ZONE… THE US ISOLATION GROWS STRONGER AFTER THE LIFTED SANCTIONS THAT RESTRICT THE EUROPEAN BANKS… THE EUROPEAN BANKS FOLLOW THE ASIANS, WHO HAS WORKED EVEN BIGGER CREDIT LINES. $$$
Austria’s Oberbank signed a major finance deal with over a dozen Iranian banks. In doing so, Oberbank becomes one of the first European financial institutions to enter the room in providing loans for Iranian projects after the removal of sanctions against the country in early 2016. They signed the deal with 14 Iranian banks at its headquarters in Linz. Officials in Tehran expressed hope that this would set the stage for similar moves with other European banks in the near future. The Iranian signatories included veteran private banks such as Parsian Bank, Saman Bank, Eqtesad Novin Bank, Bank Parargad, Karafarin Bank, and the newly established Middle East Bank. Others were former state banks that have been privatized over the past few years such as Bank Melli Iran, Bank Mellat, Bank Sepah, Tejarat Bank, Bank of Industry & Mine, Export Development Bank of Iran, Refah Bank, and Keshavarzi Bank. As the European banks align commercially with Iran, they will suffer alienation with the United States. Think more EU isolation, following the threatened sanctions against Germany for the Nord Stream II project. The Washington Fascist NeoCons are total idiots on all foreign policy.
Oberbank is the seventh biggest Austrian bank, with a balance sheet of roughly EUR 20 billion. The move was ground-breaking, as many European banks had been standing clear from Iran’s funding prospects over fears that they might come under crossfire from USGovt sanctions against the Islamic Republic. The agreement envisages a funding ceiling of EUR 1 billion, expected to involve Austrian companies in Iran’s production and development projects lasting more than two years. CEO Franz Gasselsberger stated that the agreement covered projects by Austrian companies in areas that were previously under sanctions. “We have very concrete projects in the fields of infra-structure, rail, health, hospital construction, factory building, photo-voltaics, and hydro power. The sticking point was obtaining an additional guarantee from the Iran. We negotiated with the Iranian central bank but the guarantee is evidently coming from the Iranian Finance Ministry.” That is quite the assortment and varied list of projects. Export credit guarantees covering 99% of a projected volume will be provided by the Oesterreichische Kontrollbank, the main Austrian body that issues them, Reuters added.
One the same day, Danske Bank of Denmark signed a similar finance contract worth EUR 500 million with 10 Iranian banks, becoming the second European lender to ink such an agreement with Iran. The Iranian signatories to the agreement were Saman Bank, Bank Mellat, Tejarat Bank, Bank Melli Iran, Bank of Industry & Mine, Bank Sepah, Bank Pasargad, Eqtesad Novin Bank, Keshavarzi Bank, and Parsian Bank. They will act as the agent banks, providing civil projects in Iran with the Danish fund.
The Asians are also more deeply involved, with much bigger credit lines. A similar move between China’s CITIC Group and a consortium of Iranian banks came recently. It will provide loans worth a collective of $10 billion for the country’s infra-structure projects. Furthermore, Iran had also in late August secured an EUR 8 billion credit line from South Korea's Eximbank. It was seen as the country’s biggest loan deal since the removal of sanctions against it in early 2016. See PressTV (HERE).
◄$$$ THE UNITED STATES USED TO BE THE ENVY OF THE WORLD, BUT NO MORE… THE US LEADS IN AN UNENVIED CATEGORY, DRUG-INDUCED DEATHS. WITNESS A SICK SECONDARY EFFECT TO THE AFGHAN WAR. $$$
The Afghan War has a significant side effect. It supplies the US streets with heroin at a fraction of the cost compared to 20 years ago. Worse, the Big Pharma companies exploit the situation, enjoying lower feeder costs on their opioid business, while subservient doctors write prescriptions willy nilly on pain killers. Few Americans realize the one third of medical school costs are borne by Big Pharma firms, which afterwards require US doctors to prescribe drugs made of complex molecules, often damaging the liver, usually with unwanted side effects, and almost always difficult to digest thoroughly. The doctors are restricted from suggesting natural remedies, at the risk of losing their medical license (granted by Big Pharma). The Rockefellers own half the entire equity in Big Pharma companies, which are actively lacing vaccines with active viruses (more deaths) and adjuvant contaminants (autism) and immune suppressant agents (cancer). But the opioid abuse leads to basic heroin addiction and magnificent profits. Big Pharma has drugs to treat the heroin addiction also, but not to treat death, since immune from legal liability. Here is the giant kicker. The Big Pharma firms cannot be sued for vaccine damage or deaths, due to a recent enacted law.
## USGOVT DEBT LIMIT MORASSE
◄$$$ THE USCONGRESS MANAGED TO EXTEND THE USGOVT DEBT LIMIT TO DECEMBER… THE USGOVT PASSED A BILL TOWARD AID FOR THE HURRICANE HARVEY, ALONG WITH DEBT LIMIT EXTENSION… WARRING POLITICAL CAMPS CAME TOGETHER. $$$
In early September, the US House of Representatives passed a $15.3 billion disaster aid package that also raises the federal debt ceiling. It extends government funding for three months into December. Lawmakers approved the legislation 316-90, which was made final by President Trump. His crew of military handlers probably held his hand for the signature. The massive package will replenish rapidly dwindling FEMA emergency accounts as Florida braced for the impact of Hurricane Irma and Texas recovers from the devastation of the Hurricane Harvey. More aid packages will come.
The urgent legislation, backed 80-17 by the Senate on September 7th, would provide money to fund government agencies through December 8th. Finally the threat has been eliminated of a official shutdown upon the new fiscal year starting on October 1st. That date was the deadline date. Senate Republicans cast all 17 dissenting votes. President Trump stunned Republicans by striking a compromise deal with Democratic leaders to increase the debt limit for three months, rather than to force the long-term approach preferred by his own party. Voting on the debt limit is politically toxic for Republicans, as they abhor stepwise solutions. Many observers suspected that the hurricanes would expedite a rapid compromise, including the Jackass. It happened so. The true switch in position came also from White House budget director Mick Mulvaney, a former tea party member who took a hard line against debt increases during his many years in the House.
The arcane debt limit suspension replenishes the USDept Treasury ability to tap other accounts to maintain cash flows. Therefore the practical date of a potential default would not come before February or March. Such is the rough calculation by Shai Akabas, who tracks the issue for the Bipartisan Policy Center, a Washington think tank. An imposed limit for December would result in the same special fund borrowing practices as done every time in the past. They raid all the pension funds and trust funds, anything exposed.
The aid money serves as the first installment on a recovery and rebuilding package for the twin hurricanes that could eclipse the more than $110 billion cost to taxpayers of Hurricane Katrina in 2005. The actual size of the package was augmented at the last moment. Just a technical note, as taxpayers do not pay for much of anything except the vast federal bureaucracy, since the aid cost makes worse the $1.2 trillion deficit that not even foreign bond investors pay for. The debt is financed by the USFed and its QE bond monetization, plus the USDept Treasury Bond derivative machinery. A third Hurricane Maria is set to slam the eastern seaboard in the coming days, if not already. See CBS News (HERE). As political scum Rahm Emanuel, former Mossad agent operating in the Obama Admin, used to say, “Never let a good crisis go to waste.” The fabricated hurricanes served a purpose, even while they wrecked a portion of the USEconomy with full and vicious premeditated motive by King Rothschild. More to come.
◄$$$ THE USGOVT DEFICIT IS AT RISK OF APPROACHING $2 TRILLION… WITH THE CATS LOOSE OUT OF THE BAG ON NEW ADDITIONAL SPENDING ON STORM RELIEF, MORE MEASURES COULD BE PILED ON, ADDING TO THE ALREADY STAGGERING DEFICIT… IT IS ALMOST CERTAIN THAT $1.5 TRILLION WILL BE EXCEEDED IN THE FEDERAL DEFICIT… WITH ONLY A LITTLE IMAGINATION, THE DEFICIT COULD REACH $2 TRILLION, AND FEW WOULD BLINK AN EYE… BUT FOREIGNERS WILL REACT HARSHLY. $$$
In due time, the citizens watch groups, the financial analysts, and mere individuals will have an opportunity to observe what is inside the storm relief package with all its related pork. Houston was the given excuse, the proximal cause. The rhinos surely caved in, but might have required a little something for the home state with its own problems. The list might be endless and even amusing. If not with this relief bill, look for other pork items stacked onto new legislation, an easy task in the United Broken States. Consider some aid to replenish the Pension Benefit Guarantee Corp which insure busted pension funds, of which there are too many to count. The PBGC is empty. Consider Social Security running in the red, in need of a boost in funds. Consider some foreign aid (read arms gifts) to our friendly allies, if we have any left. The US always wants more wars. Consider some highway patch funding for the decrepit interstate system, loaded with potholes. Consider some more green tech aid where Congressional members, or Obama himself again (see Solyndra), have hidden investments.
The vision is clear of a toilet flushing after the handle pull, on all counts. This could unravel very quickly, as foreign nations (read the Eastern Hemisphere) reject the USDollar in trade payments. It could blow our jaded minds. It will not just be financial markets taking hits, but the stage set for introducing the New Scheiss Dollar. The USTreasury Bond market will soon act strangely, maybe with a death rally in a Black Hole climax fake-out. Watch for strange activity at US ports, where the USTBill might be refused. Over half the federal deficit has been funded in recent years by QE at the USFed and the USDept Treasury with derivatives. Even if near $2 trillion in fiscal year deficit, the USGovt will invite a foreign response from the shock, disgust, and visceral criticism to come. The Washington NeoCon Fascists will blame it on the weather.
◄$$$ ATTORNEY GENERAL JEFF SESSIONS WAS REBUKED IN SURPRISE VOTE AS THE USCONGRESS ROLLED BACK HIS ASSET FORFEITURE PET PROGRAM… ANY ADMINISTRATION ADVOCATING PRIVATE SEIZURE OF ASSETS WITHOUT CRIMINAL CHARGES FILED IS OF A PURE FASCIST LEANING… THE TOTALITARIAN DEVICE HAS BEEN TEMPORARILY REMOVED. $$$
As preface, the forfeiture program is the cornerstone behind $billions in stolen money from private citizens, ordinary law abiding citizens. The 2016 total of roadside police thefts of cash, citing the Patriot Act (Fascist Manifesto), exceeded the total in home robberies. Witness the fascist state in action. In a stunning move, the House of Representatives approved an amendment to the Make America Secure & Prosperous Appropriations Act that will roll back expansion of asset forfeiture, the pet project pushed by Attorney General Jeff Sessions. Thus he qualifies as a fascist pig.
Civil asset forfeiture is a practice by which law enforcement can forcibly and legally seize assets from a person who is suspected of a crime, even without a charge or conviction. Sessions revived the Justice Department’s Equitable Sharing Program, which allowed state and local police agencies to use seized assets and then give them to the federal government, which would in turn give a chunk back to the local police. This served as a way for these local agencies to skirt past state laws designed to limit asset forfeiture. Obama attempted to halt the fascist asset seizures. Sessions worked to stop the reforms that were in progress. The Jackass cannot point to a single positive motion by Obama except this motion during his eight long years in the White House, where he hosted many gay sex parties, played a lot of golf, spoke at fundraising events, and read the teleprompter at press conferences.
Virginia Rep Don Beyer crossed parties to give support for the Congressional action on limiting the fascist grabs. He stated, “Civil asset forfeiture without limits presents one of the strongest threats to our civil, property, and Constitutional rights. It creates a perverse incentive to seek profits over justice.” True Datt! The amendment passed with a voice vote, which means it had overwhelming support. That way individual members can later deny they voted for or against. See The Intercept (HERE).
As an example, suppose Ma & Pa Kettle are driving home from visiting their son and his wife in Pennsylvania. They left with $3800 in cash, placed in a satchel on the back seat. It was from a returned loan from parents to son. The police stopped the Kettles for exceeding the speed limit, when the only real hint of impropriety was Pa smoking a cigar with the window open. The police did not issue a speeding citation, realizing it was not marijuana, but they took the cash, all of it. Another example, Miguel Sanchez in San Diego California has been improperly suspected of running cocaine when he visits his cousins in Acapulco Mexico by a private fast running boat. He loves the waves and runs at 50mph often. The boat was purchased from ample savings in his thriving hardware business. The local police at SDPD stop Sanchez, searched his boat, found no drugs, and seized the $2500 in cash. He had the cash for gifts to his cousin and the rest for the trip, like for meals at nice restaurants. Witness the fascist police state, in pure opression.
◄$$$ OPEN LETTER TO PRESIDENT TRUMP: AMERICA IS IN FOR A RUDE AWAKENING IN JANUARY, FROM CABAL CREATURE JIM RICKARDS… HE MAKES MANY GOOD POINTS… HE DESCRIBES INTEGRATION OF A NEW CURRENCY (BASED IN THE IMF SDR) WHICH WILL BE IMPLEMENTED WITHIN A BLOCKCHAIN… THE JACKASS MAKES A REBUTTAL… THE EAST HAS THEIR OWN BETTER PLAN, FAR MORE RELIABLE AND STURDY… THEIRS WILL BE BUILT UPON THE GOLD STANDARD, AND WILL CONTINUE UNTIL FULLY IMPLEMENTED, WHICH WILL FORCE THE DEATH OF KING DOLLAR… IT WILL BE MESSY. $$$
Dear President Trump,
Over the last couple of years I have been all over TV, from Fox News to CNBC, CNN, and Bloomberg. I have been telling our fellow Americans that the financial global elite was planning to issue their own globalist currency called special drawing rights, or SDRs. And that those elites would use this new currency to replace the USDollar as the global reserve currency. I have even written about this extensively in my best-selling books, entitled “The Road to Ruin” and “The New Case for Gold.” I am sure some people in the mainstream media thought I was out of line, but the United Nations and the International Monetary Fund (IMF) have both confirmed this plan to replace the USDollar is real. I have made this warning many times, but it seems to be falling on deaf ears. That is why I am writing directly to you. Here is the proof that the USDollar is under attack, right in front of our eyes:
The UN said we need “a new global reserve system that no longer relies on the United States dollar as the single major reserve currency.” And the IMF admitted they want to make “the special drawing right (SDR) the principal reserve asset in the [international monetary system].” More recently, the IMF advanced their plan by helping private institutions, such as the UK’s Standard Chartered Bank, issue bonds in SDRs. Although our mainstream media ignored this major event, the UK media reported:
SDR Special Drawing Rights. This is all happening. On January 1st, 2018, this trend to replace the USDollar will accelerate. That is when the global elite will implement a major change to the plumbing of our financial system. It is a brand new worldwide banking system called Distributed Ledger Technology. It will have a huge impact on seniors who are now preparing for retirement. When this system goes live, many nations will be able to dump the USDollar for SDR units. For now, the USDollar is still the world’s reserve currency. Other nations have to hold and use the USDollar for international trade, instead of their own currencies. This creates a virtually unlimited demand for USDollars, which allows us to print trillions of dollars each year to pay for wars, debt, and anything we want. It keeps our country operating. Now, we can see that the global elites are working to unseat the USDollar as the global reserve currency. The IMF is using new financial technology to create an SDR payment system, because that is the currency they issue.
Here are the three key pieces of information that prove this will happen.
Fact #1: The IMF issues a globalist currency called special drawing rights, or SDRs.
Fact #2: The IMF has confirmed they want to replace the USDollar with SDRs.
Fact #3: The IMF has confirmed Distributed Ledgers can be used for currency substitution, and they have even set up a special task force to speed up implementation.
IMF Lagarde Special Drawing Rights. Christine Lagarde, head of the IMF, was asked about the task force. She said, “As I see it, all this amounts to a brave new world for the financial sector.” Yes, a brave new world where the USDollar is no longer the world reserve currency. Barbara Matthews, a former USTreasury Department attache to the European Union, has reached the same conclusion. She said the link between the globalists’ currency and Distributed Ledgers is impossible to avoid. And that “the IMF seems to be exploring the possibility of permitting a broader use of [their globalist currency] beyond internal transactions among member central banks.”
Make no mistake, if the IMF is planning to use Distributed Ledgers to replace the USDollar with SDR units. And just to be clear, when SDRs take over, the American people will be left with devalued dollars. Once other nations start accumulating the globalist currency through Distributed Ledgers, they will no longer need to hold dollars. Once Distributed Ledgers go live, other nations will no longer need to buy USTreasury bonds. And that means the US government will no longer be able to finance its normal operations, including welfare programs like Social Security. For those who have their retirement account parked in stocks, they could watch it evaporate in a matter of days. The weakest companies in the stock market could collapse, once this plan goes live.
Just look what happened the last time we had a big change in our global financial system. In 1971, Nixon announced the United States would no longer officially trade dollars for gold. That created a lot of uncertainties, turning that decade into a nightmare for stock investors. Back then, the Dow Jones Industrial Index, an index of stable blue chip stocks (the kind most retirees like to hold), was cut in half. Stock investors bailed out of the market and, for the most part, did not come back for a decade. I expect something similar once Distributed Ledgers go live.
The transition from a USDollar system to a new system dominated by SDR units will be messy. Stocks will collapse, and will stay down. There will be no recovery this time, because the US government will not be able to come to the rescue like they did in 2008. You will even have funding for normal operations, let alone enough funds to save stock investors. I know that governments have been patiently watching Distributed Ledger (often referred to as blockchain) technology develop and grow outside their control for the past eight years. Libertarian supporters of Distributed Ledgers celebrate this lack of government control. Yet, their celebration is premature, and their belief in the sustainability of powerful systems outside government control is naive. Governments do not like competition, especially when it comes to money.
You probably know that you, or any government, cannot stop Distributed Ledger technology. In fact you probably do not want to. Governments and monetary elites want to control it using powers of regulation, taxation, and investigation. An elite US legal institution called the Uniform Law Commission, which proposes model laws intended for adoption in all fifty states, has released its latest proposal called the Uniform Regulation of Virtual Currency Businesses Act. This new law will not only provide a regulatory scheme for state regulators, but will also be a platform for litigation by private plaintiffs and class action lawyers seeking recourse against real or imagined abuses by digital coin exchanges and facilities. We know the US government will want to use this technology for its benefit.
One step toward government control just occurred a few weeks ago. On 1 August 2017, the SEC announced Guidance on Regulation of Initial Coin Offerings, the first step toward requiring fundraising through Distributed Ledger, or blockchain-based tokens to register with the government. But consider the following additional developments:
- On 1 August 2017, the World Economic Forum, host body to the Davos conference of global super-elites, published a paper entitled “Four Reasons to Question the Hype around Blockchain.”
- On 7 August 2017, China announced they will begin using Distributed Ledger technology to collect taxes and issue electronic invoices to citizens there.
Perhaps most portentously, the International Monetary Fund (IMF) has weighed in. In a special report dated June 2017, the IMF had this to say about Distributed Ledgers. The IMF favors control by a pre-selected group of participants or one organization, rather than allowing anyone to participate. This paper should be viewed as the first step in the IMF’s plan to migrate its existing form of world money, the SDR, onto a DLT platform controlled by the IMF. They are telling you exactly what their plan is. It would be foolish to ignore them, or assume the USDollar will remain the global reserve currency much longer once this plan is implemented, as early as 1 January 2018. You know the global elites are not your biggest fan. You know the USDollar has been under attack. This is the global financial elites’ plan to remove the USDollar from its position of power and to attack your administration all at once. Who do you think Americans will blame when the stock market crashes, or Social Security runs out? We can hear the talking heads already.
Best, Jim Rickards, for The Daily Reckoning (HERE)
The Jackass has a few comments to offer in rebuttal. Rickards makes a lot of sense, and sounds like an adversary of the elite, when he is their shill still. He opposes the elite when convenient for book sales or subscriptions. He overlooks numerous developments in progress, and movements in support of non-USD platforms, all of which have significant momentum. It is like he has Eastern blinders on, only paying attention to his Western camp of fawning admirers, while he willfully ignores the other half of the globe. It has more power than he might give them credit. So the IMF will direct the Distributed Ledger Tech (DLT) for replacing the USDollar, with special consultants and participants, all selected from their camp of trusted fraud specialists. A reality check is required. The IMF will try to switch control for the failed paper currency system centered upon the USDollar to the SDR basket of currencies, which itself is based in five fiat paper currencies. It is nothing more than different fiat paper, also under their centralized control. The Austrian School of Economics purports a corollary that paper money cannot replace a broken paper money system, as only Gold can replace it. No exception exists in human history.
The IMF will strive to combine the blockchain technology with more bad money, but worse, under centralized control. Rickards did not mention gold-backed SDRs, but that might occur. Again, centralized control, just like with the USDollar which is controlled by the USFed central tower, and USDept Treasury watch tower. It will be hard to see it succeed, given the centralized control. The entire crypto currency space relies upon decentralization and transparency. Expect neither with the SDR DLT plan. The armada of Eastern nations will continue to lead in a new set of platforms outside the USD or anything proposed by the IMF, and they will continue to be led by China with Russia in full support. The IMF is seen as having a full generation of predatory activity, mere offices for the true global control obelisk in Basel Switzerland. The West has lost all trust with their client states and rival states. The East has their own plan, built over the last three years, which will operate outside the USDollar shadow. The Eastern developments toward a new financial structure will not be abandoned, and will rely upon Gold as its core. The East will roll out the Revived Gold Standard, done in stages, first in trade, second in banking, lastly in currencies. The West will not be in charge of reform when they were responsible for failure with fraud and war trimmings.
## USDOLLAR SUNSET IN RESERVE ROLE
◄$$$ THE USECONOMY FACES PRICE INFLATION THREAT, BUT NOT FROM FOREIGN DOLLARS COMING HOME… UNIQUE POWERFUL PRESSURES ARE BEING PUT ON THE USDOLLAR AS GLOBAL CURRENCY RESERVE… THE GREENBACK WILL LOSE THE PRIVILEGE, AND FORCE MASSIVE PRESSURES IN TURN ON THE USECONOMY FOR ITS IMPORTED SUPPLY CHAIN… THE PRICE INFLATION WILL COME FROM IMPORTED PRODUCTS AND COMPONENTS, PLUS THE HIGHER INTEREST RATE, AFTER THE LAUNCH OF THE NEW SCHEISS DOLLAR… THE PAPER GREENBACK WILL YIELD TO THE GOLD-BACKED REDBACK (CHINESE YUAN)… SUNSET OF THE KING DOLLAR MEANS BIRTH OF A NEW DAY FOR THE DOMESTIC DOLLAR IN THE NEWEST THIRD WORLD COUNTRY, THE UNITED SOCIALIST STATES OF AMERICA. $$$
Much has been written in recent months about the scourge of a sudden price inflation chapter within the USEconomy. Often the factor cited is an ocean of USDollars returning home. This point is off base and wrong footed. Price inflation will occur but not for the reasons stated. About $700 billion in USTBonds have been dumped in the last two years, done by foreign central banks. It has had no effect on the bond market, and it continues. The reality is that the USFed soaked it all up. Actually its partner the USDept Treasury soaked it up with artificially produced bond demand though powerful derivative contracts, which continues every month. There are $20 trillion in US citizen owned foreign bank accounts in USDollar form. If it comes home, it is taxed by 30% to 40%. Therefore it does not come home. The USGovt is making a deal to reduce the tax rate to 10% to 20%, but few takers. Some USD will find its way back home, but more like a trickle, and nowhere like what the USGovt expects. So the Obama Admin created 31,000 new Treasury jobs during his gay blade tenure. They are going out to find USD accounts, freeze them, then steal them. The US citizens are given a chance to defend themselves in preventing the confiscation. But the agents reject all the defense, seize the accounts, and use whatever information is given to pursue other accounts. The USGovt is giving a 40% cut to the foreign bankers who cooperate in the thefts. Clean, illegal, but no consequence. Think extended fascist state.
The imported price inflation will come only after the USD loses its global currency reserve status. The price inflation effect will not come from the front door, in returning USDollars. Besides, returning real money is never inflationary, but rather stimulative of the very best parts of the economic fabric. Only newly created marginal money or debt is inflationary. Note bad economic analysis and shoddy thought process. Instead, the price inflation effect will come from the back door. When the King Dollar loses its coveted global reserve status, tremendous disruption will come to the real economy, from port traffic hairballs. The rise of the gold-backed Chinese Yuan (aka Redback) will change the global financial stage. The USEconomy will be in danger of halted supply chain on the import side. Under severe pressure, the USGovt must launch a new Scheiss Dollar, in order to assure the imported supply to the numerous economic segments. The newly hatched currency will have its fundamentals resembling the Third World. The annual trade deficit of $550bn, and the annual federal deficit of $1.2 trillion are each growing worse by the year, and will cause huge imbalances that must be rectified.
In the past, the imbalances never were rectified, only resulting in bigger purchases by vassal foreign states, and bigger bank reserves of toxic paper in the balances sheets. All the debt has been called assets, serving as bank reserves in an upside world. The debt saturation has turned critical. The new Scheiss Dollar will be devalued in a sequence of fierce brutal painful steps. Then the price inflation will hit, but from imported products and components. Hidden within all corners of the USEconomy are foreign-made components, even in US-made cars, even in the energy cost structure, even in the food supply chain. The United States will also have to raise its interest rate on new bonds from the new Scheiss Dollar, in order to attract foreign capital, like any other African nation that used to monetize its debt.
◄$$$ OPEC PROBLEM CHILDREN ARE HOLDING DOWN OIL PRICES… THEY CANNOT COLLUDE ANY LONGER LIKE A TRUE CARTEL… OPEC IS DEAD, AND SIGNALS THE END OF THE PETRO-DOLLAR… ITS COLLAPSE MEANS A CERTAIN LOSS OF GLOBAL CURRENCY RESERVE, FOR WHICH OIL WAS THE NUCLEUS. $$$
OPEC no longer functions as an oil cartel. Internal squabbling, individual vested interests, funding of ISIS, private predatory war (see Saudi in Yemen), and even Islamic bickering has brought the cartel down. The output from Iran cannot be restricted in its sales volume. They urgently need to gain revenue and re-establish the revenue stream, following illegal sanctions over the last four years which continue. The US shale oil industry acts like the noose around the neck in a literal sense for the oil price. It is well described by SRS Rocco, a fine analyst. Every time the oil price rises, the shale output rises, adding to supply, pulling down the price. The reality is that baby OPEC countries cannot reduce output, since they need the money badly to patch their deficits and to finance war in the Gulf region. Therefore, prices will stay low because output among them cannot be controlled or restricted. The valves from Iran are finally full bore open, making it impossible for the OPEC policy to gain traction. To wit, Iran had 80 oil tanker vessels parked off the coast, ready to deliver into the market. World oil prices are not able to rise. Furthermore, the global economic recession has reduced oil demand. See Wall Street Journal (HERE).
◄$$$ INTERNATIONALIZATION OF THE CHINESE YUAN CURRENCY PICKS UP MOMENTUM… IT IS MAJOR PRIORITY FOR THE CHINESE GOVT, TO GAIN RESPECT AND TO OPERATE FREE FROM THE KING DOLLAR SHADOW… THEIR EMPHASIS IS MORE PLACED ON TRADE PAYMENTS CONDUCTED IN RMB TERMS, THAN IN GLOBAL BANK RESERVES HELD IN RMB-BASED BONDS… PROGRESS WILL COME AFTER THE C.I.P.S. TRANSACTION SYSTEM RAMPS UP (COMPETITOR TO SWIFT), AND THE IMPORTANT SHANGHAI FINANCIAL REFORMS ARE MADE FINAL FOR CROSS-BORDER INVESTMENT AND FUNDS FLOW. $$$
The Peoples Bank of China, in a report released last month, used the term Yuan Internationalization for the first time, which is intended to describe its six years of efforts in promoting global usage of the currency. Its efforts are paying off, as progress has been made. The RMB today is the fifth largest payment currency in the world, according to SWIFT data. Their central bank has so far signed currency swap deals with 32 countries and regions, and has appointed 16 banks across Asia, the Americas, Europe, and Australia to act as clearinghouses for the Yuan. The internationalization process began in 2009 when the central bank allowed cross-border trade settlements in Yuan for the first time. It continued by opening various channels under control by quotas for foreign capital to invest in domestic bond and stock markets. Next comes the competitor to SWIFT. In a report issued last month, the Peoples Bank of China said it will launch a cross-border clearing mechanism called the China International Payment System (CIPS) this year. The PBOC will support foreign entities issuing RMB-denominated bonds onshore, will facilitate foreign institutions investing in the domestic interbank bond market, and further liberalizing steps for foreign banks.
The Standard Chartered Bank has sketched a picture of how the transformation will proceed in the near future. Ding Shuang is chief economist at StanChart in China. He stated, “Within the next three years, China will achieve capital liberalization in a managed way. By managed, we mean well-grounded capital account transactions will be free, and restrictions only on speculative short-term capital flows. Restrictions will be triggered only in cases of huge external impacts and crises to prevent excessive money flows. Yuan internationalization has been faster than expected in the past five years, and it will be equally exciting in the next five years.”
StanChart anticipates the volume of foreign trade settled in the Yuan will rise to 50% in 2020 from 25% currently. Other effects will come in official bank reserves, but China puts higher emphasis on trade payment patterns. The value of Yuan assets will be equal to between 4% and 5 % of global central bank reserves by 2020, up from less than 1 percent now. The Beijing leaders do not want foreigners to hold their sovereign debt like the United States does, with deep abuse and heightened risk. Furthermore, the value of domestic bonds held by foreign investors is expected to jump six-fold to about CNY 5 trillion (=US$806 bn). Shanghai strives to become an international financial center by the year 2020. It must fulfill more in the deregulation of the Yuan, as well as build more mature financial platforms. Toward this end, the CIPS bank transaction system will come online. It will enable cross-border Yuan clearing by both onshore and offshore participants with a common international coding system. It is expected to be launched in Shanghai sometime in 3Q2017, years in preparation. It will compete with SWIFT and largely eliminate its role in the East.
The first phase will mainly offer one-on-one transaction settlement, mostly to serve cross-border trade and foreign direct investment. The second phase, with an unspecified start date, will use a mixed settlement system that is more liquidity efficient. The system is expected to reduce the costs and time of processing cross-border payments. It will gradually replace clearing banks as a major mechanism for setting offshore Yuan deposit rates and will provide a major channel for offshore Yuan to flow back onshore. The Shanghai cross-border Yuan transaction market totaled CNY 1.01 trillion in the first five months of this year, the largest among any Chinese city or province.
Fan Yifei, deputy governor of the Peoples Bank of China, said central monetary authorities will support Shanghai’s financial reform process. They will allow offshore Yuan holders to make domestic equity investments. This will be enabled by piloting offshore Yuan lending for multi-national corporations, by opening up foreign currency payment for third-party payment agencies, and by supporting money market fund companies offering RMB-foreign exchange options. These are crucial features heretofore not available, amidst some complaints. The central government is also about to release a set of new deregulation guidelines for financial markets to support the interface between the China (Shanghai) Pilot Free Trade Zone and the city’s transformation into an international financial center. See Shanghai Daily (HERE).
◄$$$ DEMISE OF KING DOLLAR IS DENIED, WITHOUT REVIEW OF A POTENTIAL COVER CLAUSE AND MUCH HIGHER GOLD PRICE… MUCH ERRANT ANALYSIS CONTINUES TO CIRCULATE… THE GOLD STANDARD WILL NOT APPEAR IN CURRENCIES UNTIL FIRST IN TRADE PAYMENTS… THIS POINT IS NOT WELL UNDERSTOOD. $$$
Every few months a vapid essay appears on dismissal of the exaggerated threat to the King Dollar and its reign of financial terror. Here is another, and by the same wayward analyst Charles Hugh Smith. He insists on being dogmatic, which Mark Twain once described as wrong at the top of one’s voice. The Jackass issued a rebuttal of this analyst’s work several months ago. CHSmith is at it again. He overlooks the gold cover clause, which would allow a gold currency issuer to redeem say 5% of the currency with gold bullion as a limit. In doing so, most of the gold backing in vaults would be left intact, and the gold volume would be extended effectively. If and when the Gold price rises to $6000 per oz, for instance, buffeted by a 5% cover clause, the effect would be to provide ample backing for 5x20=100 times as much currency that has been created and floated recklessly in the last decade. CHSmith does not comprehend the Gold Standard re-installation will happen last in currency. Instead, the perfect standard will appear first in trade payments, then in banking reserves, and finally in currencies. He has blinders on, or else is myopic. He is as stubborn as he is wrong-minded. See his latest eloquent errant prose on Zero Hedge (HERE).
◄$$$ WESTERN SYSTEMIC CRISIS 2017-2019: THE ALMIGHTY DOLLAR AGAINST THE GREAT PETRO-GAS-YUAN TEMPTATION, WHICH WILL BE IN PLACE BY YEAR END… EXPECT THE SAUDIS TO BE LINKED IN… THE END OF THE KING DOLLAR REIGN IS NEAR, VERY NEAR… CONSIDER THE EUROPEAN VIEWPOINT. $$$
Qatar, North Korea, the Baltic Sea, risk of a World War III, and all the military ranting mentioned in the media lately, are issues going hand in hand with the programmed and imminent advent of the catastrophic scenario for the dollar as a unique world reference currency: the Petro-Yuan will be in place at the end of the year. More than a Petro-currency, it will be a Petro-Gas-Gold currency! The West is thus preparing to switch to total anachronism with this founding act of the 21st Century multi-polar world. 2014-2017: here we are, at the end of a three-year exacerbation period of tensions on all front lines (West against the rest of the world) and we are witnessing the up-coming end of the dollar’s reign over the world and overall financial systems and their related economic activities. Sanctions, blockades, proxy-wars, direct military threats, the question is whether the current clash of arms is really a warning sign of an Nth suicide of the West whilst hoping in vain to stop time, or whether the solution conveying power is on the verge of carrying away all possible resistance.
The magnet effect of the brand new Petro-Yuan! The world’s biggest oil importer, China is preparing to launch gold-backed Yuan-denominated oil futures, possibly creating the most important Asian benchmark in the oil sector, allowing oil exporters to switch from USDollar-denominated assets by transactions in Yuan. To make the Yuan-denominated contracts more attractive, China plans to have the Yuan fully convertible into gold on the Shanghai and Hong Kong foreign exchange markets. Last month, the Shanghai Futures Exchange and its subsidiary, the Shanghai International Energy Exchange (INE) successfully completed four production environment tests for crude oil futures; also, the exchange continues with preparatory work for crude oil futures contracts, aiming to launch operations at the end of this year. China’s Yuan asset value, coupled with the Hong Kong Stock Exchange’s plan to sell Yuan-denominated physical gold futures, will create a system helping countries to bypass the US banking system.
The countries which will immediately benefit from this revolution are, of course, the countries under Western sanctions, such as Russia, Iran, Venezuela. Those mentioned countries are, by the way, sitting on the world’s largest reserves of gas and oil, that is the reason why we are talking of Petro-Gas-Yuan, knowing that gas represents the energy of the future much more than oil does.
Will Saudi Arabia swing over to the other side? The context has changed rapidly: gas dethroned oil, Saudi Arabia starts to invest in gas extraction infra-structure, the US is now a major competitor of its Saudi strategic ally in terms of gas production (with reduced imports from 14 million barrels a day in 2007 to 8 million barrels in 2017) and the Russians reduce their imports of Saudi oil. All this means that Saudi Arabia, already a victim of the price crisis in the past years, must absolutely not risk losing China as a customer as it will end up with vast production reserves which will automatically bring down prices. Besides, the Other World provides guarantees of firmness and price stability (via its new OPEC/NOPEP system), guarantees which the West no longer conveys (as the United States does not participate).
Under these circumstances, no wonder that King Salman of Saudi Arabia has just removed from the succession Prince Ben Nayef in favour of Prince Ben Salman, the latter being known for his Russian and Chinese sympathies. See GEAB (HERE).
## GOLD JUXTAPOSED WITH FINANCIAL REFORM
◄$$$ CHINA MIGHT BE FASHIONING A PACT INTERNALLY ON GOLD PROVISION FOR OFFICIAL MONETARY PURPOSES… THEY ARE WORKING ON CREATING A GOLD-BACKED CURRENCY. $$$
A Hat Trick Letter client in Texas is connected to a high level financial circle. She passed this comment on, made by the influential friend. “China has now approached the Elders for a major Gold sale to back the RMB. It will be part facilitated, and that will put huge pressure on the US global ambitions.” The Jackass belief is Chinese official gold reserves are half the commitment, and Chinese elder gold reserves the other half. Think shared commitment between communist party and private elders toward the very important and highly disruptive step of introducing a gold-backed currency. It is difficult to know exactly, but the suspicion is that elders refers to the White Dragon Society. The Voice added a comment that essentially confirms that the Beijing officials and their independent central bank have all the resources they require without any involvement by other nations. The Voice wrote, “China does not need any help from anyone, nor does Russia.” The big event with a gold-backed currency has already been given a major boost by the Oil-Gold contract in Shanghai, but further confirmation with directly convertible RMB currency to Gold taken in bullion bar form is right around the next corner in time. So far the indication is for conversion of oil to gold, by means of the RMB table.
◄$$$ PROSPECTS FOR GOLD… PRICE OF MEXICO CLAIMS THE BULLION BANKS OF BRITAIN AND WESTERN EUROPE WILL SUPPLY GOLD FOR CHINESE CONVERSION WITH RESPECT TO THE NEW OIL-GOLD FUTURES CONTRACT… THE LONDON BANKERS WOULD SERVE AS THE KEY GOLD INTERMEDIARY… THE BANK OF CHINA WOULD PLAY A KEY ROLE AS INTERMEDIARY… THE SAUDIS ALONE AT ONE MILLION BARRELS EXPORTED TO CHINA ON A DAILY BASIS WOULD TRANSLATE TO 1.2 TONS GOLD IN TRANSFER, TAKEN OFF THE MARKET… PRICE EXPECTS THE GOLD PRICE TO RISE TOWARD SEVERAL $THOUSAND PER OUNCE. $$$
The following is taken from Hugo Salinas Price, an astute analyst and warrior from Mexico with a sturdy excellent reputation for his integrity. I suppose that the Bullion Banks are not going to want to accept Yuan, in exchange for the delivery of physical gold. They will first convert their Yuan into Dollars, and the only likely provider of Dollars will have to be the Bank of China, and which, by the way, in any case desires to reduce its Dollar holdings. Thus the Bullion Banks will offer Dollars for gold. This operation kills two birds with one stone: the oil exporters get their gold from London and China reduces its dollar holdings, which they wish to do. As I see it, here is where the fun begins.
First, the amount of gold which the Bullion Banks can provide will put a very unusual strain upon them. The Bullion Banks are accustomed to control de price of paper gold in such a way that they make it extremely difficult for the holders of paper gold contracts to obtain delivery of physical gold. However, as the Chinese scheme comes into operation, this situation will change: a new purchaser of large amounts of physical gold has come upon the scene. A very upsetting development for the Bullion Banks, never before seen by any of the managers of those banks!
Secondly, the amount of oil that goes to China is enormous. China is the largest importer of oil in the world, eight million barrels a day. Saudi Arabia sells about one million barrels a day to China, for Dollars. If only Saudi Arabia decides to take Yuan and Gold for those Yuan, we are talking about one million times $50 Dollars per barrel which equals $50 million Dollars a day. At $1315 Dollars per ounce, that comes to 38,023 ounces of gold (=1.183 tons) which Saudi would take off the gold market every day. Millions of barrels of oil will have to balance in value against a very limited amount of gold available. The 1.183 tons a day means the Saudis will be taking 431.8 tons of gold off the market every year, and they are not the only oil exporters that China is wooing. Other oil exporters accepting Yuan payment for conversion into gold, might very easily increase the departure from London of 1000 tons or more of physical gold, every year, whose destination will be Hong Kong or Shanghai, in addition to the gold London has been providing normally.
To balance the mass of oil received by China, against a limited amount of available gold in London, it will be necessary for gold to skyrocket upward in Yuan terms, and necessarily, in Dollar terms as well. In effect, the Yuan will suffer a tremendous devaluation against gold, and so will the Dollar. I cannot imagine at what price the gold/oil trade will finally stabilize, but I think it will have to be at many thousands of dollars per ounce. Perhaps the Chinese government sees the Yuan devaluation as favorable for China. I have no opinion on that matter. As for a huge devaluation of the Dollar against gold, I leave the consequences to your imagination. Will China actually carry through with this Oil-for Yuan-for Gold scheme? We shall have to wait and see. See Hugo Salinas Price on Mexican Plata (HERE) and The Daily Economist (HERE).
◄$$$ CHINA'S UPCOMING OIL FOR GOLD CONTRACT WILL DRIVE UP GOLD PRICES, AS THE PROGRAM PLANS TO OBTAIN THE METAL FROM LONDON MARKETS… THINK INTERMEDIARY… A DEAL WAS POSSIBLY CUT, BETWEEN BEIJING AND LONDON, THE DETAILS FOR WHICH ARE WORTH HUNTING FOR… CHINA IS SHOWING ITS CONTROL OF LONDON, ALL THE WHILE IT HAS ITS HOOKS ON WALL STREET BANKS… WATCH FOR SIGNS THAT LONDON HAS A NEW CHINESE PARTNER, AND ABANDONS THE UNITED STATES IN CURRENCY REGIME DEFENSE. $$$
As preface, permit the Jackass conjecture. The Chinese bankers likely promised to conduct significant offshore banking in London, to compensate for the BREXIT departures within the financial sector. Refer to bond issuance, stock investment, and ownership stakes in banks, hedge fund activity, and much more. Watch the ARAMCO deal, to see if both Hong Kong and London have the lock on IPO stocks sales, if the deal ever comes to final fruition. The Chinese might have also promised to make a gradual Gold price rise over the course of the next couple years. They might have promised a gradual rollout of the non-USD platforms which have (according to the Voice) been stressed tested already. They might have promised a tipoff of imminent plans with launches, so as not to take the London Centre banks off guard, even to permit from profiting on insider information. Other arrangements and understandings between Beijing and London might form a sizeable list.
The One Belt One Road initiative was created by Chinese planners after long thought about circumventing the conceived threat of obstruction from the West. Similarly, the Central Committee, composed of six PhD members of varied backgrounds, thought through the potential for gold domination and exercised six years of discipline in massive gold bullion acquisition. With certainty, they planned and prepared ahead about the reaction from the West upon their intended implementation, especially toward the Beltway behavior duplicitous behavior with respect to trade tariffs and meddlesome tactics by the USGovt. The US leaders are predictably dishonest and dishonorable.
The Chinese deploy their own pressured tactics, surely some blackmail with threats to dump sovereign debt securities. If any path was presented to short circuit the control of power through Gold, the West would find it, use it, and run with it. Therefore, conclude all avenues of price suppression were anticipated in advance by the astute Chinese players. They are new to the game, but not greenhorns or sadly naive, but rather quick learners. They are even well along in the hitmen role, having taken out some Rothschild players, the scoop passed along to this desk. London remains cavalier about the new monetary medium within the Global Paradigm Shift. Much evidence already points to China having a grip on Downing Street and the Bank of England. It could be that China sees BREXIT as the sealed deal, with the British more vulnerable, and thus some key deals struck recently. The irony might be that London bankers will assist in taking down the King Dollar and dismantling its court. Thanks to DonaldS in South Florida for his thoughts on this matter.
The Jackass must remind in a past story, well cited six years ago. It deserves repeated mention. Back in 2011, the Hat Trick Letter included an extremely important story from the Voice, whereby the White Dragons bought 1000 tons of London gold per month. They deployed very powerful leverage, used the Hague Court officials, and as the Voice told a few times, held the London feet to the fire to complete the gold sourcing in enormous volume. It is believed the Voice was an agent in the gold acquisition, though not admitted (think disclosure agreement). It is also known, directly from the conversations, that the London bankers had improperly used Chinese gold in the Euro currency foundation at the time of its launch. Some significant derivative contracts were put in place as the foundation, and they had some fraudulent elements. The Chinese led the fraud (rehypothecation without permission) pass, but on condition of the 1000 tons gold shipments per month taken off the London dock. The monthly shipments lasted until March 2013. He said it lasted for 27 months, for almost 30,000 tons.
Over these six years, other gold analysts such as Koos Jansen have concluded that China has accumulated more than 30,000 tons gold. It was almost 30,000 tons from London alone, which was supplied in part by the Vatican and possibly Basel. My conclusion is that China has accumulated perhaps 40,000 tons in this time. Other stories were told during that time period, such as the Bank of England digging the bottom of their barrels for bars with very old legacy markings. It indicated how the BOE had been drained. London served as a gateway from 2011 to 2013, and it still does on gold bullion provision. China might have arranged for London to be their bitch lackey on the shipping dock, for moving huge amounts of gold in the next chapter. This time, the Chinese will assure of workable and significant Gold price increases.
Continue in the implications for Chinese control, but not in the way of conjecture. Think simple consequence for known events. China has control in Bank of England, as described above. They have moved enormous tonnage of gold as evidence of the control. China has control of USFed, as a reported minority interest owner of the Federal Reserve itself. Also China has some Wall Street power and influence, as seen from their JPMorgan HQ acquisition in 2015. They own the JPM site and complex, which includes the largest bank gold vault in the West, connected with underground tunnels to the USFed gold vault. It is from the New York Fed. Also, EuroRaj suspects China was owner of defaulted bonds linked to Internal Revenue Service secure stream income, set up by China at the turn of the new millennium, the result being the forfeiture of the JPMorgan HQ, a crown jewel of the Wall Street community. The asset seizure was part of the 1999 giant gold lease, which was reneged upon in 2007 or 2008. The giveaway, which motivates further research, was the gift low price on the JMP HQ, at less than half the market value. So China controls US-UK gold management offices and vaults. What a grand game of thrones.
◄$$$ GOLD, OIL, AND DE-DOLLARIZATION ARE MOVING FORWARD WITH THE FULL DEVELOPMENT OF THE EURASIAN TRADE ZONE… THE BRICS NATIONS WILL PUSH THE NON-USD TRADE AND BANKING FUNCTIONS IN THEIR EMERGING MARKET SECTOR… NO LONGER WILL EASTERN NATIONS FINANCE THE KING DOLLAR WAR MACHINE… RUSSIA AND CHINA OWN EXTENSIVE GOLD RESERVES, WHICH WILL SUPPORT IN COORDINATION FOR THE NON-USD PARADE…
THE CHINA RMB-OIL MARKET IS PROCEEDING ON THE GOLDEN TABLE FOR TRANSACTIONS, TO HATCH THE GOLD TRADE NOTE SOON… THE NEW SILK ROAD WILL HAVE A GILDED CENTER LINE STRIPE FOR THE ENTIRE TRADE ZONE… NO AMOUNT OF SANCTIONS WILL STOP IT… THE BRICS AND SCO WILL BECOME IMPORTANT FACTORS, BUT ACTUALLY IN RUSSIAN-CHINESE TOW FROM THEIR SUPERPOWER JUGGERNAUT LOCOMOTIVE. $$$
The Eastern organizations are coming together, both in trade & banking and in security & culture. They are a new power to be reckoned with in the geopolitical arena. They operate with military overtones found in Russian (seen in action) and China (waiting in wings). Backed by superpower Russia, the other superpower China is taking decisive steps to create a very viable alternative to the tyranny of the USDollar over world trade and finance. Together, they form the two lead Clydesdale horses for the Eurasian Trade Zone, moving forward fast with a solid plan. Wall Street and Washington are not amused, but they are powerless to stop it.
The USGovt and its IMF tool, combined with market manipulator Wall Street banks, were able to create a grand crisis in the Eurozone in 2010, seen in the Greek Govt debt default threat with attendant crisis. The world trading surplus countries like China, Japan, and then Russia, had no practical alternative but to buy more USGovt debt. They bought USTreasury securities with most of their USD surplus trade. The Japanese surplus was derived from diverse exports. Washington and Wall Street could print endless volumes of USD units backed by nothing more USMilitary front hardware. The sick irony and ugly reality is that China, Russia, and other USTBond holders essentially financed the US-led wars that were aimed at them, by buying US debt. Then they had few viable alternative options. They aided and abetted the King Dollar War Machine. That hideous pattern has ended.
A powerful game breaker alternative has emerged in the Gold-Yuan-Oil contract out of Shanghai. Russia and China are carefully unveiling that most feared alternative. It is a viable gold-backed international currency that can displace the unjust hegemonic role of the dollar today. Other several similar currencies could potentially follow. For several years both the Russian Federation and the Peoples Republic of China have been buying huge volumes of gold, largely to add to their central bank currency reserves. In the past, those reserves were dominated by bonds denominated in USDollars or Euro currencies. For several years it has been known in gold markets that the largest buyers of physical gold were the central banks of China and of Russia. They fortified their currencies, which were routinely under attack by the Dollar Court of minion bankers, as they responded to increasing economic sanctions and bellicose words of trade war out of Washington. The RC pair have responded.
China and Russia, joined most assuredly by their major trading partner countries in the BRICS (Brazil, Russia, India, China, South Africa), as well as by their Eurasian partner countries of the Shanghai Cooperation Organization (SCO), are about to complete the working architecture of a new monetary alternative to a world based in USD trade payments, bilateral transactions, and banking reserves. Currently, in addition to founding members China and Russia, the SCO full members include Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, and most recently India and Pakistan. Expect Iran to join the Eurasian Trade Zone and SCO both, adding to their power and influence. This is a union with population well over three billion people, some 42% of the entire world population, coming together in a coherent, planned, peaceful economic and political cooperation. They control a critical mass of the global economy, a very important point for fomenting change.
These nations of the East, plus the Emerging Market nations, are set to endorse the Gold-backed Silk Road led by China and fully supported by Russia. The Silk Road is in the process of changing the world balance of economic power. Next comes the altered financial structure and resulting power. The East is rising while the West is sinking. It is clear that the economic diplomacy of China, as of Russia and the train of Eurasian Economic Union countries, is very much focused upon realization of advanced high-speed rail, ports, energy, and infra-structure weaving together a vast new market that in the next few years will overshadow any economic potentials in the debt-bloated economically stagnant OECD countries of the EU and North America. The factor lacking has been a strategy to free the nations of Eurasia from the USDollar’s shadow and extorted fees. They required to be released from their vulnerability to further USTreasury sanctions and financial warfare based on their USD dependence.
At the September 5th annual BRICS Summit in Xiamen China, a big splash occurred. Russian President Putin made a simple and very clear statement of the Russian view of the present economic world. It is his multi-polar perspective, and rejection of the centralized Western financial dominance. He stated, “Russia shares the BRICS country concerns over the unfairness of the global financial and economic architecture, which does not give due regard to the growing weight of the emerging economies. We are ready to work together with our partners to promote international financial regulation reforms, and to overcome the excessive domination of the limited number of reserve currencies.” This is Putin’s first explicit focus on currencies, and should be regarded as a tossed gauntlet in the global monetary war. Put in context of the latest financial architecture unveiled by Beijing, new degrees of economic freedom from the East are to be launched like warships. The shiny vessel from Shanghai China is a super destroyer capable of sinking the USS Dollar that has ruled the waves for 40 years.
Enter the Chinese Oil-Gold-Yuan futures contract. China is on the verge of launching a crude oil futures contract denominated in Chinese Yuan that will be convertible into gold. Over the past two years by China has strived to become a viable alternative to London and New York. Their financial center is Shanghai. China is the world’s largest importer of oil, the vast majority of which is still paid in USDollars. If the new Yuan oil futures contract gains wide acceptance, it could become the most important Asia-based crude oil benchmark. That would challenge the two Wall Street-dominated oil benchmark contracts in North Sea Brent and West Texas Intermediate oil futures that until now has given Wall Street huge hidden advantages. China would gain a huge manipulation lever for usage by its oil partners, including the world’s leading oil producer Russia joined at its hip. Introduction of an oil futures contract traded in Shanghai in Yuan, should be viewed against the backdrop of China having gained membership in the select IMF SDR group of currencies. This new oil futures contract, when convertible into gold, could change the geopolitical balance of power dramatically away from the Atlantic world to Eurasia. If only we could see George Orwell wink an eye while adjusting his chair.
In April 2016, China made a major move to become the new gold center for global trade in physical gold at the Shanghai Gold Exchange. China today is the world’s largest gold producer, far ahead of fellow BRICS member South Africa, with Russia second in rank. The new oil futures contract traded in China in Yuan with the Gold backing will lead to a dramatic shift by key OPEC members, led by the Middle East Arab monarchies, to prefer Gold-backed Yuan for their Petro-Dollars that carry a USFed inflation risk as well as a warmonger geopolitical risk. China is wresting control of the financial aspect of the oil market, filling the void from the wrecked dismantled and defunct Petro-Dollar. The new presence of the Russian Oil Consortium and the NatGas Energy Cartel makes for an obsolete and lackey OPEC, whose funeral dirge is loudly and broadly heard. The Eastern energy structure is being woven together effectively with a financial structure into a very coherent strategy. See Global Research (HERE).
◄$$$ THE SHANGHAI GOLD EXCHANGE IS FORCING SIGNIFICANT CHANGES, AS ITS IMPACT IS FELT UNDER MUCH MORE INFLUENCE… LONDON SILVER WILL BE PRICED IN RUBLES, YUAN (ONSHORE & OFFSHORE), RUPEES, AND OTHER CURRENCIES… SWEEPING CHANGES HAVE BEGUN… THE GRAND HINT IS OF REFORM, MORE OPEN MARKET, AND A BIG PUSH FROM FOREIGN DEMAND LOCATIONS. $$$
A request for feedback was made on their proposed changes to the LBMA. It should be clearly noted that no party made any feedback. Therefore the proposal will launch as stated on 25 September 2017. Note a proposal: Highlights from the Plan of Administration (link to entire document HERE) from new ICE Benchmark. This means that IBA proposes to make some changes to the process of setting the benchmark.
A provision calls for removing the Seller’s Premium:
Currently, silver auction participants settle trades arising from the auction at a premium of USD 0.5 cents per ounce which is added to the benchmark price so that all trades settle at a higher price than the published benchmark. Participants settle amongst themselves at the auction price plus the Seller’s Premium without any additional spread. Participants settle with their clients at a spread around the benchmark price plus the Seller’s Premium. Participants each set a spread at which they will buy from clients and sell to clients. The spreads are agreed bilaterally between Participants and each of their clients. The supply chain for physical silver is linked together by a series of principal-to-principal transactions starting from miner to refiner before moving onto the banks that intermediate between producers and consumers. The actual USD per ounce value of many of the transactions between these market segments is linked to the London Silver Price. Firms in the market will typically buy and sell using this same reference price and will therefore tend to add a commission when selling in order to account for their value added.
Another provision calls for increasing the number of LBMA Silver Price currencies:
The LBMA Silver Price is currently published in USD, EUR and GBP. The USD prices are published to three decimal places and the EUR and GBP prices are published to four decimal places. The price discovery in IBA’s Gold auction is in USD. At the end of the auction, the price for Gold in USD is converted into other currencies. These non-USD prices are published as indicative settlement prices at the end of the auction, or as benchmarks for reference in derivative contracts. The additional currencies in the LBMA Gold Price are Australian Dollars, British Pounds, Canadian Dollars, Euros, Onshore and Offshore Yuan, Indian Rupees, Japanese Yen, Malaysian Ringgit, Russian Rubles, Singapore Dollars, South African Rand, Swiss Francs, New Taiwan Dollars, Thai Baht, and Turkish Lira. The LBMA Gold Price is available both in prices per ounce and in prices per gram. IBA intends to publish the LBMA Silver Price in the same currencies and in prices per ounce and prices per gram. See Silver Doctors (HERE).
In reaction to growing influence of Shanghai Gold Exchange, the LBMA will begin settling silver contracts in multiple currencies. The Daily Economist concluded the following. “Over the past six months the LBMA has experienced an incredible amount of turmoil, especially with their contracted auction authorities leaving with more than two years remaining on their contract. In part this has led more and more business to flow Eastward to Shanghai where a much more transparent and regulated Gold & Silver market has flourished under Chinese control. To suddenly shift towards the acceptance of a multitude of non-Western currencies speaks volumes on the rising growth and power of Eastern economies, and at a time when the Dollar, Euro, and British Pound are losing ground in global settlement. What is most likely to occur is not that more investors will come to the LBMA to purchase metals contracts because of this new regulation, but that nations like China, Russia, and India will increase their buys of physical silver from Western market coffers, and will now do so without having to pay the middleman to participate in this market.” See The Daily Economist (HERE).
## GOLD MACHINATIONS AT WORK
◄$$$ BIG GOLD HIT, WITH SWAPS AT THE CRIME SCENE… THE BANK FOR INTERNATIONAL SETTLEMENTS IS FLOODING THE SYSTEM WITH PHYSICAL GOLD… THEY ARE LEASING LARGE QUANTITIES OF GOLD TO THIRD PARTIES, USED FOR DUMPING ON THE MARKET… IT AMOUNTS TO 870 TONS IN RECENT MONTHS, WITH A LARGE AMOUNT IN AUGUST ALONE… IT SEEMS LIKE THE LAST LINE OF DEFENSE FOR THE CORRUPTED GOLD MARKET… GOLD IS THE ONLY PHYSICAL COMMODITY WHOSE PRICE HAS DECLINED IN RESPONSE TO OVERWHELMING DEMAND FROM CHINA, INDIA, AND ASIA GENERALLY… THE BASEL TOWER OF SATAN HAS WORKED HARD TO PREVENT A GOLD BREAKOUT… THIS COULD BE THE FINAL EPISODE. $$$
Gold swaps at the Bank For Intl Settlements (BIS) have soared from zero in March 2016 to almost 500 tons by August 2017. Their outstanding balance on swaps is currently higher than it was in 2011, when the violent coordinated take-down of the gold price began. That was in September 2011 for gold and in April 2011 for silver. Gold swaps work similarly to USFed bond REPO transactions. When banks need cash liquidity, the USFed extends short-term loans to the banks and receives USTreasurys as collateral. QE can be seen as a multi-$trillion Permanent REPO operation with zero oversight, zero controls, and zero Main Street benefit, which has involved outright money printing. It is unsterilized monetary inflation, the worst kind, known in every example to destroy the national economy.
The gold swaps enable the BIS to release physical gold into the banking system which can then be used upon market sale, to assist the central banks in suppressing actively the Gold price lower. This explains the fast rise in BIS gold swaps between March 2016 and March 2017, correlated well with the decline in the Gold price from August 2016 until early July 2017. Conversely, it also explains the rise in the Gold price between July and September this year, which again correlates with a decline in the outstanding gold swaps between April and July. Finally, the hit on gold that began earlier this month coincides with a sudden jump in BIS gold swaps in the month of August. To be sure, the logistics require a short time-lag between the formal gold swap operation and the time to mobilize the physical gold in the illicit motivated sale. The graphic below shows the increase in gold swaps from March 2016 to March 2017. Note that the BIS expresses its financials in SDR units, not USDollars. It is the Special Drawing Rights basket of five currencies: USD, Euro, BPound, JYen, Chinese Yuan.
As you can see, the total amount of the gold loans outstanding increased by 14.1 billion SDR units in a twelve month period. More evidence of collusion and manipulation is evident. The reports of gold backwardation in London (viz James Turk) and the backwardation observed here (by linked author) between the current delivery month COMEX gold contract and the London gold fix events over the past several months once more correlates well with the sudden jump in gold swap activity at the BIS. Backwardation in any commodity market indicates that the demand for delivery of the underlying commodity is greater than the near-term supply of that commodity. It is hard to ignore that the backwardation observed on the LBMA and with COMEX nearest month gold contracts, has been accompanied by soaring gold demand from India. The gold imports rose three-fold from the April-August period. The price suppression is plain as day, plain as the nose on your face. Fortunately, the price manipulation and market interference are receiving a great deal of attention and adverse publicity.
Furthermore, it appears as if the BIS gold swap activity continued to increase between March 2017 and August 2017. Their August Account Statement shows another 2.2 billion SDR unit increase in amount of outstanding gold loans in aggregate. These gold loans are primarily swaps. However, this jump in gold swaps between March and August is somewhat misleading. The outstanding amount of loans declined from 27.2 billion SDRs at the end of March to 24.6 billion SDRs at the end of July. The Gold price rose over 11% between July and early September. By the end of August, the BIS balance sheet shows 29.3 billion SDRs, meaning a jump of 4.7 billion SDRs worth of gold swaps. The central banks scurried to pull gold back in its price during just the last couple months.
An event occurred, which forced a central bank reaction, an unexpected event. Around April of this year, the World Gold Council began to forecast that India’s gold importation would drop to 95 tons per quarter starting in Q2. The opposite occurred. Instead, India imported 248 tons of gold in 2Q2017. This quantity does not include smuggled gold, which could double the official amount. Note the curious correlation between the jump in BIS gold swap activity at the end of the summer and the unexpected surge in Indian gold imports. The criminal monetary entity BIS reacted to control the Gold price, preventing a breakout upward. As always, the central bank dumping will in all likelihood never see a return of the same gold at the same price. It represents a big upcoming financial loss for those who issued the gold swap. They are investing in the USD-based system, protecting their right to give themselves $trillion loans at zero percent, protecting their monetary monopoly and kingdom. The loss is a leveraged investment cost. It is a massive crime scene, with killed foreign nations in defiance, with killed agents in the Global Money Cold War. Their monopoly and kingdom is on the verge of collapsing.
The Jackass believes we are witnessing the last gasp by the Vatican and BIS in supplying physical gold to suppress the Gold price, since finally using bullion bars. In the past several years, the main tool for price suppression has been paper gold in the form of futures contracts. The big banks on CB orders would dump three months worth of global gold mine output in an hour, never to deliver the gold. This activity detailed above represents a very big acute difference in their tactics. They are dumping physical gold. In numerous instances from 2016 and 2017, the paper gold dumping did not succeed. The Gold price responded with a snapback in hours, or in days. The banker cabal, whose office agent is the Bank of England, whose market agent is the USFed, but whose central command center is Basel, are turning desperate. The gold bar suppliers are the Bank For Intl Settlements in Basel Switzerland and the Vatican in Rome. They are dumping their precious gold bars. To be sure, their Basel vault and Rome vault contain on the order of 50,000 to 70,000 tons gold in each location, or they used to contain such tremendous volume. The vast drain from West to East, from London to Shanghai, has been at work for six years. This latest activity stinks of desperation and last ditch defense. Paper slings and arrows do not work anymore, thus the need for metal spears.
Dave Kranzler concluded, “In my view, there is a direct correlation between this sudden leap in the amount of gold swaps conducted by the BIS between July and August and the price attack on gold that began two weeks ago. The gold swaps provide bullion bar liquidity to the bullion banks, who can use them to deliver into the rising demand for deliveries from India, China, Turkey, et al. This in turn relieves the strength and size of bid on the LBMA for physical gold, which in turn makes it easier for the same bullion banks to attack the price of gold on the COMEX using paper gold. This explains the current manipulated take-down in the price of gold despite the rising seasonal demand from India and China.” Mission accomplished in the short term but a failed game in the long term. But Kranzler does not make direct comment on the clear desperation from such swap activity. See Investment Research Dynamics (HERE) and Economic Times of India (HERE).
◄$$$ THE PRICE/DEBT RATIO RELATED TO GOLD IS AT ITS LOWEST LEVEL IN 47 YEARS, EVEN AS THE PLANET IS ENGULFED IN UNPAYABLE DEBT AND ENGINEERED GIGANTIC BUBBLES IN ALL FINANCIAL MARKETS… THE RATIO HAS FALLEN FROM 8% IN 2010 TO 3% TODAY… EXPECT A REVERSAL IN THE RATION IN THE NEXT COUPLE YEARS. $$$
◄$$$ HISTORICAL GOLD CHART SHOWS THE LONG-TERM DOWNTREND SINCE THE $1900 PEAK BROKEN IN 2016… THE SLIGHT DOWNTREND ON INTERMEDIATE BASIS WAS BROKEN EARLIER IN 2016… THE NEW CURRENT PATTERN IS WORKING TO ESTABLISH AN UPTREND, TO BE MADE CLEAR WHEN THE GOLD PRICE PASSES THE $1350 LEVEL... THE BULLISH WEDGE IS A PROMISING PATTERN. $$$
◄$$$ CHINESE GOLD PRODUCTION HAS TOPPED OFF, COMPENSATED BY PLANS FOR HIGHER IMPORTS… IN EARLY 2017, THE CHINESE ANNOUNCED A REDUCTION IN GOLD MINE OUTPUT… PROBABLY A PLOY. $$$
When the Chinese Govt announced several months ago a halt in gold mine output at their marginal mines, it was believed to be a ploy. They probably continue with mining operations, and tuck away the gold bullion bars in the bank vaults. They seemed clever in working the geopolitical angle, to justify heavier volume imports. See the topping off of their mine output in the chart. Their imports, just through Hong Kong, have proved steady this year. With seven months complete, the 453 tons year to date would extrapolate to 776 tons in the full year. The buzz on the grapevine is that in recent months the imports are coming directly to Shanghai from sources like Australia, bypassing Hong Kong. Chinese imports through Hong Kong (not including Shanghai) are as follows.
453 tons (through July)
◄$$$ RUSSIAN GOLD PRODUCTION HAS ALSO TOPPED OFF, AT LEAST ADMITTED IN OFFICIAL STATEMENTS… THEY REACT TO LOWER GOLD PRICES. $$$
These two charts should be taken in a certain manner for amusement. China owns over 30,000 tons gold in its reserves, kept in the central bank, sovereign wealth funds, and private elder family vaults. The two nations are working in concerted efforts toward establishing the Gold Standard in the global financial system. They will not be deterred. The Russians own a nearly equal amount like over 25,000 tons gold, kept in vaults under the Kremlin. Russian tonnage added to official gold reserves, nearly all from domestic production are as follows.
◄$$$ MORE CONSENSUS IS COMING OUT AMONG GOLD ANALYSTS THAT CENTRAL BANKS ARE THE PRIMARY MANIPULATORS OF GOLD PRICES… THEY DO A FUTILE TASK TO DEFEND A BROKEN SYSTEM. $$$
Over the past two weeks gold prices have seen a decline of just over 4% from a yearly high of over $1352, to its current level of $1293. While this move isn't even close to some of the previous beatdowns in the precious metal, one German analyst believes that nearly all severe price movements over the past 24 years have been intrinsically tied to collaborative central bank manipulations. Gold prices have been subject to constant manipulations since 1993, German expert on the gold market Dimitri Speck told Sputnik Germany. According to him, the manipulation of gold prices has been presented by the media as if it has been initiated by a couple of malicious traders just recently, but this idea is wrong.
Speck stated, “When the gold price manipulation started on 5August 1993, these were central banks that initiated the process, and namely the then head of the US Central Bank Alan Greenspan. He did not want to let the gold price rise over $400.” He added that Greenspan feared that a significant increase in gold prices might affect the so-called inflation thermometer that the Gold price was known to be. The expert noted that the US Fed had arranged an agreement among the central banks to keep the gold price below $400 dollars. This was done for several years by means of sales and loans.
Two weeks ago, an article was published by The Daily Economist (HERE) that demonstrated how the central bank of central banks (Bank For Intl Settlements) has been dumping excess amounts of gold onto the markets at higher levels than they did in 2011, when the gold price had reached its all-time high of $1940. However gold price manipulation by the central banks to protect sovereign currencies and interest rates goes back much further than 1993 and the efforts of Fed Chairman Alan Greenspan. In face, the idea of gold price manipulation appears to go back at least as far as 1973, when following the Federal Reserve efforts to curb stagflation, then USFed Chairman Paul Volcker admitted that his biggest regret was in not manipulating gold prices during that time. See The Daily Economist (HERE) and Sputnik News (HERE).
◄$$$ THE MEXICAN CONGRESS HAS BEGUN TO DEBATE THE MONETIZATION OF THE LIBERTAD SILVER COIN… A FORUM HAS BEEN CREATED WITHIN THE CHAMBER OF CONGRESS FOR REPRESENTATIVES (DIPUTADOS)… THE PLAN IS TO ENCOURAGE CITIZEN SAVINGS, WITH THE MEXICAN CENTRAL BANK PROVIDING A FLOOR ON THE SILVER PRICE. $$$
On September 13th, Hugo Salinas Price participated in a forum within the Mexican Federal Congress, called “The Promotion of Savings by Mexicans” organized by the group of members of the Chamber of Deputies (i.e. Congressmen) in the Mexican Federal Congress. The diputado group is led by Congressman Francisco Javier Pinto. For the meeting to take place within the Legislative Houses of the Mexican Republic is extraordinary news. Development of savings within the national economy is a high priority, given the economic distress from a declining oil price and ravaged Mexican Peso currency.
According to the poll taken by the National Poll Regarding Financial Participation in 2015, only 15% of the public saves in a formal manner such as by bank deposits, government bonds, or retirement accounts. Much of the rest save at home in shoe boxes and mattresses. The Mexicans have not been able to retain purchasing power of their savings. Sadly, these formal methods are only alternatives that provide less loss of purchasing power. Thus the imperative seen, the basis in motive at the Forum to give a stable value to the Mexican silver coin.
The central feature of the proposal is that the Central Bank of Mexico (Banxico) shall determine a value in Pesos for the flagship Libertad silver ounce. Its value shall be slightly higher (by a percentage defined in the corresponding Law) than the price of Silver in the international market. In this way, it provides Banxico with an assured profit in minting and placing these coins in monetary circulation. Today, for example, at the present rate of exchange and the present price of Silver, the Mexican silver ounce is worth $320 Pesos. Build within the Proposal a premium of 10%. In that case, the Banxico monetary quote for the Libertad silver ounce would be for $352 pesos.
If the price of Silver should plunge tomorrow to $250 Pesos to the ounce, for example, the Mexican central bank would support a floor on the monetary value of the Libertad ounce. In that way, the saver would not lose and the silver coin would remain in circulation. HSPrice does not expect the public to actually use the Libertad coin as money, due to Gresham’s Law. Low quality money in coinage would dominate in circulation, according to the powerful law, which actually has appeared in quoted form on the SUBSCRIBE webpage for the Hat Trick Letter for over 13 years. High quality money is tucked away in drawers, home wall safes, and bank safety boxes, removed from circulation. Practically all ounces would be held as savings for the long term or for emergencies, the public certain to choose to keep on spending fiat money for daily needs, because it is money of no quality at all. The law is beyond rebuke or challenge, a fascinating and logic principle.
In Mexico as in the United States, in point of fact, all the coins carried around in pockets have face value (stamped monetary value) worth less than the plain metal used to make them. When their melted metal is worth more than the monetary value on the coins, they go out of circulation and are replaced by cheaper coins which act like tokens within the society. It is heresy, but the phenomenon is common. A disappearing act has come to the coins for 5, 10, or 20 centavos (cents) in circulation, and hardly ever is seen the once popular yellow 50 centavo coins. In the United States, the older pure silver coins exited circulation over 30 years ago. They became collector’s items, such as junk silver bags. The Jackass owns a few.
On the other hand, if the price of Silver should jump higher, Banxico would have to issue new higher quotes for the Libertad silver ounce (according to the formula to be established by Law). In this way, again, the coin will remain in circulation. Since it has no nominal price stamped on it, just the weight, the coin will avoid ending up at the refineries, like all the old silver coins that had stamped values in the past. Almost all old silver coins, once their content was worth more than the peso stamped value on their faces, ended up in the refineries. The holders of the coins sold their coins at a profit, for their silver valuable metal content. Such will not happen with the Libertad silver ounce, whose value will be adjusted upward to the benefit of the saver. Banxico will thus protect the saver. The coin will thus retain his purchasing power, no matter what may happen with inflation. As a result of owning silver Libertad ounces, the savings for citizens will float on the ocean of currency through the years.
HSPrice concluded, “The great peace of mind for the investor, great or small, will encourage savings and financial responsibility better than any other policy of public stimulus. This is not the first time that this proposal comes before the Mexican Congress, but we pray that this time it becomes a reality. We hope so. It is for Mexico, the world's #1 producer of silver!” See 24 Hour Gold (HERE). A translation of a report on a debate in the Mexican Congress is published by Economist Guillermo Barba. See Pilotzi Noticias (HERE). Note that Price is a Hat Trick Letter subscriber, who two years ago provided a gift subscription to Barba. As footnote, the Spanish word for weight is peso. The Mexicans once realized the value of a currency was derived from the weight of the coin.
## SAUDI FRAUD & DESPERATION
◄$$$ SAUDI SECURITY FORCES ARRESTED OPPOSITION CLERICS… ETHICS FOR THE SAUDI KINGDOM ARE GOING DOWN FAST. $$$
The diplomatic standoff between Saudi Arabia and Qatar has led to a rift between Wahhabi clerics. Saudi security forces have used this opportunity to remove some government opponents. In the last couple weeks, the Saudi Govt has arrested Salman al-Ouda, Awad al-Qarni, and Ali al-Amri. They were criticizing the Saudi Royals and supporting Qatar. The Saudi security forces have also arrested a number of Saudi clerics, including Mohammad al-Khodayari, Mohammad al-Habdan, Ibrahim al-Harthi, Yusouf al-Ahmad, Ibrahim al-Nasser, Ibrahim al-Fares, and Gorom al-Beshe. In addition, Hasan Farhan Maliki (cleric from Jizan city and opponent of Wahhabism and Saudi official policies) and the media activist Fahad al-Sunaidy were also among the detained people. See South Front (HERE).
◄$$$ THE MUCH HERALDED ARAMCO IPO DEAL IS TO BE DELAYED, AS THE TIMETABLE GETS TIGHT AND NEW CONFLICTS ARISE… SAUDIS PREPARE FOR POSSIBLE ARAMCO IPO LAUNCH TO 2019… THE SAUDIS STILL AIM FOR LATE 2018, WHEREAS THE DECISION ON WHERE TO LIST OVERSEAS MAY COME IN LATE OCTOBER (NEXT MONTH)… THIS DEAL MIGHT NEVER HAPPEN, SINCE FULL OF FRAUD AS AWARENESS GROWS IN THE DISCLOSURE PROCESS… THE USGOVT IS FINALLY TOSSING THE SAUDI PARTNERS UNDER THE BUS, IN A SHAMEFUL DISPLAY OF BETRAYAL. $$$
Saudi Arabia is preparing contingency plans for a possible delay to the initial public offering of its state-owned oil company by a few months into 2019. The situation is much worse and more dire than the corrupt Riyadh Royals suggest. While the government is still aiming for a Saudi ARAMCO Initial Public Offering of equity stock in the second half of next year, that timetable suddenly is not feasible. They must push back the timing of the IPO launch for what would be the biggest share sale in history, or the biggest stock fraud in history since Enron.
Saudi ARAMCO said in statement the IPO remains on track. They lie. They are desperate. They are running out of money. They say, “The IPO process is well underway and Saudi ARAMCO remains focused on ensuring that all IPO related work is completed to the very highest standards on time.” It did not give a timeframe, nor did they imply any hint of independent confirmation for oil reserves in the Saudi Kingdom. Multiple problems have arisen. The comment was echoed by a Saudi government source. The target date has been second half of 2018. Several important decisions on the IPO have yet to be made final, stretching the ability of the company and its advisers to sell shares before the end of next year. For example, Saudi Arabia has yet to announce where it will sell shares in ARAMCO other than the domestic stock exchange in Riyadh. The Royal criminals plan on holding a big investment conference in Riyadh where some decisions will be made. The delay in selecting a foreign exchange, mostly likely London or New York, has had a knock-on effect on other preparatory work. The Chinese would prefer that Hong Kong hosts the stock for trading, since RMB is desired in the investment. Not mentioned is the inherent risk to the underwriter investment banks, if and when the massive fraud is revealed. Saudi ARAMCO has hired JPMorgan Chase, Morgan Stanley, HSBC Bank, Moelis, and Evercore Partners to advise on the IPO issuance. Independent Wall Street consultant Michael Klein is advising the oil ministry. This elite group must be alert to lawsuits for fraud down the road, or they should be. The Chinese surely distrust the entire crew of investment bankers, who bring with them a long list of bond frauds.
ARAMCO valuation is the major issue in the backroom controversies. Big investors have balked, complaining about proof of oil reserves. The Riyadh Royal criminals rely upon the depressed oil price as the excuse for delays, along with choice of exchange locations. Saudi Arabia has made numerous complaints about weaker oil prices, which will help determine the value of Saudi Arabian Oil Co, as ARAMCO is formally known. The government has previously said the valuation may reach $2 trillion, while analysts including those at Sanford Bernstein and Rystad Energy, have tended to give lower estimates. This is official financial newspeak for being overpriced by four-fold. The Western investment banks have completed their comparative analyses, using ExxonMobil, Royal Dutch Shell, and Rosneft, only to conclude that ARAMCO is worth between $400 and $500 billion, a fraction of the lofty exaggerated $2000 billion that the desert clowns cite.
Riyadh built a coalition between OPEC and other oil producers last year to reduce supply and bolster prices. They call it a coalition, when more like a goofy gaggle that speaks Arabic inhabiting the same conference room as some more astute and successful oil producers in Russia. It has been a dismal failure with no OPEC cartel unity. In the past, other cartel pacts were struck with the Saudis disregarding. Now the OPEC cartel’s recent pact is only honored by the Saudis. It is hilarious the disunity as much as the planned fraud. The Saudis continue to mention the depressed oil price as an obstacle. It is not the obstacle, but rather proving the Saudi claims of huge oil reserves. The kingdom is badly depleted, its existing oil reserves only a fraction of what they claim. Their dirty Yemen War is intended to steal the neighbor’s oil & gas reserves, all untapped and so tempting. They are liars in robes and headdress, and war criminals operating under the US shield. Should Saudi Arabia achieve its valuation of $2 trillion, the 5 percent stake it plans to sell would raise about $100 billion. That would eclipse the $25 billion raised by Alibaba Group Holding Ltd in 2014, the current record. Forget about it, never going to happen.
ARAMCO Chief Executive Officer Amin Nasser reminds that the share sale is the cornerstone of Vision 2030, a much wider plan conceived by Crown Prince Mohammed bin Salman to reshape the Saudi Economy and diminish its dependence on oil. The Saudi fools have ambitions for a diversified economy in full development. But they are 20 to 30 years late, and one war too far. The kingdom has squandered $trillions in oil revenue, surpluses, and investments. The list would take several pages for itemizing their squandered funds and opulent investments to satisfy their greed, depravity, and disdain for their own population. Their squandered $trillions coincide with $25 trillion squandered by the USGovt on war, weapons, and more war with no conceivable benefit except to military weapon makers and their elite investors. See Bloomberg (HERE & HERE) for the delay and a dose of market reality in valuation controversy. See Reuters (HERE) for the back on track statement in delusion, in absurd royal denial.
The Voice has some ripe comments, with total disrespect for the Saudi desert clowns. He still expects several failed oil monarchies, including the Saudis, with resulting chaos and princes fleeing with their $billions. His comments, my minor edits. “The deal is a grand fraud and no one buys into their bullshit any longer. The Kingdom of Saudi Arabia just had to run to the IMF for a $10 billion loan. Their entire assets have been frozen and they cannot sell any of their USTreasury Bonds and Bills. They are frozen due to the lawsuit against KSA by Americans in regards to 9/11. They are totally and royally screwed, having been tossed under the bus and train.”
The Jackass reminds of the legislation several months ago by the USCongress, opening the door for lawsuits by victim families from the felling of the World Trade Center with zero Saudi participation. They could not plan a good cocktail dinner party, let alone a demolition of a major skyscraper building. They have such parties, but they hire out the management of same. The USGovt has colluded by freezing Saudi assets. The irony is thick truly. The Saudi Prince Bandar cooperated in 2001 by creating a false front at scapegoat for blame on the crash of the WTCenter, paid by Langley. They hired Prince Bandar to produce the absurd story with ten young Cessna pilots in Florida. Together the Langley and Mossad team organized, planned, hired, and carried out the entire insider crime with massive bank heist. Bandar was paid well. He had no idea the USGovt would follow through on the massive scapegoat plan, blame the Saudis in a broad brush sense, then seize multiple $billions in assets. Welcome to the Fascist Business Model, where former allies become pure fodder and carrion to feed upon in the systemic failure known to hit the United States.
The main question to remain is whether the US Courts will permit a defense by the victimized Saudis, as they might reveal the Mossad and Bush connection with actual 9/11 culpability. My eyes will be focused on the permitted Saudi defense, and what constitutes admissible evidence. It might actually be a kangaroo court and travesty of justice. In due time, their princes will be killed by terrorists hired by Langley and Mossad. It is their specialty. The main crime by the Saudis was forming an alliance with the United States regarding the Petro-Dollar and recycled oil surplus dollars. They had their day, and the sunset is here. Time is up.
◄$$$ THE KINGDOM OF SAUDI ARABIA HAS FILED FOR A $10 BILLION LOAN REQUEST WITH THE IMF… FULL REVERSAL OF FORTUNE IS PAINFULLY CLEAR… THE KINGDOM IS ACTUALLY BANKRUPT… THE HIDDEN KILL FACTOR HAS BEEN THE COSTLY YEMEN WAR, FULLY ENCOURAGED BY THE USGOVT… THE IMF WILL FINISH THEM OFF, AND DEPLETE THEIR REMAINING ASSETS WHILE REQUIRING A CERTAIN ARAB STYLE AUSTERITY BUDGET PLAN… IT IS PURE ECONOMIC SUICIDE, WITH AMPLE PRECEDENT. $$$
The richest country in the world has suffered a humiliating fall. It is down on its knees petitioning the IMF for loans. There was a time several years ago, the handouts of Saudi Arabia to a single country used to be more than $10bn. Today, Saudi itself is looking for $10bn loan, thoroughly humbled. Such is how America will move in and eventually strangle the Saudis. They will not be left with their oil or other resources, after lured into a costly war which has bankrupted the kingdom.
The news that Saudi Arabia is applying for a $10 billion loan from the International Monetary Fund (IMF) is shocking. The country is the world’s second largest exporter of oil, but it needs a loan from the IMF. This move is likely to cause the collapse of the Saudi Economy slowly but surely. The kingdom is bankrupt and its assets are in the process of being stolen by the United States. The past few years have given an indication that the economy in Saudi Arabia is in trouble. The desired shift toward non-dependence on oil in the Vision 2020 is coming far too late, with very little funding to come, as time will tell. The vision is a ploy to attract wrong-footed investors. The price of crude oil has been the biggest contributor to this slowdown, with a decline from $147 per barrel in 2008 to the current $47 price. The high oil price led the Saudis to believe that they would enjoy massive oil revenues for a very long time, decades without end. The newest strain on their finances is the ugly Yemen War, where they wish to steal energy reserves on the same Arabian Peninsula, a similar geological shelf. The Saudis are reportedly dropping cholera on the Yemeni population. Their war crimes in Yemen will fill books, such as bombing hospitals. They paid off the United Nations to avert charges of war crimes. The Saudi Kingdom deserves its coming failure climax.
Instead of investing in the infra-structure, food technology, information technology agriculture, education, and human resources during the strong years of the last three decades, investment was diverted overseas, especially to the West. They purchased property and significant equity in Western banks. They sent their royal progeny and cousins to American and British universities. Saudi Arabia continued to import even basic foodstuffs in order to provide citizens with a comfortable life. Foreign nationals were engaged to carry out specialized as well as menial roles, as they imported almost the entire service economy. Refer to Pakistani, Indian, and Philippine workers. Next comes widespread shortages of food and other basic supplies. Not even basic industries were developed such as clothing and pharmaceuticals, never mind advanced space research, bio-technology, infotech, and defense. The squandered wealth is obscene, and will fill the annals of history for absurd displays and ruinous wealthy stream, which features thousands of royals on $million doles. Many qualify as bastards in a certain sense.
The Saudis find themselves panicking about the future of their country. In a state known for tax-free lifestyle, the government has recently introduced a family tax of 100 Saudi riyals ($27) per member per month and is introducing value added tax (VAT) from next January. Along with higher taxes, subsidies on basics like fuel, water, and electricity have been withdrawn. The price of gasoline is expected to double. The Kingdom of Saudi Arabia used to be among the richest nations in the world. Its oil exports in 2016 were valued at $136 billion, 20.1% of the world market in crude oil. The government also holds an estimated $750 billion in USTreasury securities. The questions are sure to come, as to where the wealth went. It went to foreign properties, foreign bank equity, strip club cities in the desert, giant mansions, and opulent lifestyle. More recently it went to finance a costly Yemen War, which is an utter dismal failure. The USMilitary coaxed them into the war, with $billions in weapon sales. It should be known that the US thrives on arms deals.
The fact is that the Saudis does not have access to their $750 billion. America’s Justice Against Sponsors of Terrorism Act was passed by Congress in 2016. The law now allows families to file a case against Saudi Arabia for supporting terrorism. On March 20th, 1500 survivors and 850 relatives of victims of the 9/11 attacks filed a class action lawsuit against the Kingdom of Saudi Arabia. The plaintiffs allege that the government of Saudi Arabia had prior knowledge that some of its officials and employees were Al-Qaeda operatives or sympathizers. The government in Riyadh has denied any such involvement and asked the court to reject the $100 billion lawsuit. CNBC reported that official data from the USGovt suggests that Saudi does not have immediate access to their USTreasury securities, pending the result of the legal action. In short, coupled with the downward trend of its economy, this move has left Saudi Arabia with little choice but to approach the IMF. Also, and little mentioned, the Saudis cannot touch a cool $3 trillion stuck in the USDept Treasury’s special Exchange Stabilization Fund. Such contract stipulations were probably made clear in the 1970 decade.
A final criticism of the Saudis for their betrayals. Hundreds if not thousands of European and other foreign workers, like in the petro-chemical business, have not been paid in several months. They are left stranded, with their bank accounts at risk within the Saudi system. This is part of the backdrop of the ARAMCO stock sale, hardly enough to promote confidence in external investment. Investors might suspect that much of the IPO funds be diverted either for war purposes or to pay back wages to foreign high income workers and consultants. They will never return. Other investors might suspect that the IPO funds might end up in royal overseas accounts as they flee for their lives in a near certain revolution. One can come up with several factors that would promote a palace coup and royals fleeing to Europe and the United States in sanctuary. Such is a hot topic of debate.
The IMF was established after the Second World War to help the European nations rebuild their economies. The IMF then started to fund African countries in the following years. Loans from the IMF do not come cheap. In the long-run, they bleed the local economy to death. Conditions of such loans include the following: the beneficiary government has to remove the subsidies given to basics such as fuel, water, and electricity; to open its markets to the world by removing trade barriers that allow Western corporations free access to raw materials; to devalue its currency. Countries are thus opened-up to capitalist vultures who can ransack its resources and bleed the economy. It is also suspected that the loans reward certain Swiss bank accounts (insider fees) for politicians in return for the transfer of many fixed assets. The African nation is full of IMF paths of ruin.
The IMF has overseen and engineered the systematic destruction of Africa. They will next work their magic hand of destruction on the Saudis. The IMF has a record of destroying almost all of the countries which it has financed. Consider the continent of Africa, which has been blessed with natural resources such as gold, diamonds, other precious stones, industrial metals, along with cocoa, vanilla, coffee, tea, oil. The dark continent has all the main commodities and resources. The IMF approached African countries and promised them development by exploring for resources. The result has been clear, tragic, and heinous. The Western corporations exploit the best out of Africa and the Africans are kept poor. The richness of resources under their feet entitled the ordinary Africans better access to education, healthcare, housing and jobs. The continent, however, is seen as a hub of poverty, corruption, civil wars, insurgencies, and disease. In the above clever map, observe the commodities which went to the Western nations, with hefty profits, feeding the supply chains for industrial nations, whose leaders (both in government and corporations) made sure nothing went to the natives except table scraps and bread crumbs. The horrendous outcomes are products of Western involvement. The worst example for exploitation is the very large nation of Congo, whose size matches all of Western Europe. See Middle East Monitor (HERE).
◄$$$ A CRUCIAL ARAMCO GAS PROJECT COULD BE DELAYED, DUE TO SOUR GAS AND REQUIRED DESIGN CHANGES FOR PROCESSOR PLANTS. $$$
The start-up of Saudi ARAMCO’s Wasit gas project could be delayed by at least a year. The gas coming from the offshore fields has higher sulphur content than expected. This is a timely nasty blow, but possibly a turn of earned fate. Wasit is part of the company’s push to raise production of natural gas from fields not standing next to oil wells. Wasit is an important part of plans to increase output of raw natgas from 10.2 billion cubic feet per day (bcfd) in 2010 to 15.5 bcfd in 2015. The sources offered, “The delay could be one year or more. A big portion of the material for the pipelines has to be changed. The gas is more complex.” Saudi ARAMCO denied any delay to the project which is scheduled to come online in 2014. They are practicing their lying skills, claiming that all is on track, proceeding on schedule. The main problem is sour gas, with attendant high levels of sulphur, which is more difficult and costly to process than other natural gas reserves. The same sources reported that the higher than expected sulphur content of the feed gas would negatively affect the on-shore portion of the project. Additional costly design changes were needed to handle the sour gas. See Dilmun Times (HERE).
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