Insight - China Touts Peace As West's Monetary Woes Tempt War Hawks

Saudi-Iran entente threatens petrodollar, reshapes politics far beyond Mid East

• U.S. Treasury guarantees all deposits; nations worldwide may follow.

• The Fed cannot raise rates and create money to bail out depositors.

• Massive QE to save banking is a redo of the Covid money-go-round.

• Rescue of bank depositors brings respite but the architects of chaos play on.

• Globalist goal is to retain control of all resources via central bank digital currency.

• Crises - some real, some contrived - whip the public in the direction of Reset.

• China cements Iran-Saudi accord; another blow to U.S. and dollar dominance.

• Dramatic contrast between the dividends of diplomacy and the destruction of war.

• U.S. purchasing power and agency at risk as petrodollar hangs in the balance.
  

(About 2,200 words or 11 minutes of your company. Substack’s search tool ain’t great but by using the lower “magnifying glass” you can search topics.)

Mar 14, 2023

While Russia’s military contractors the Wagner Group — who call themselves “the orchestra” — reverse Ukraine’s fortunes in Bakhmut, a discordant racket rises from the architects of chaos in the West.

It is a dangerous moment when multiple crises could prompt rash decisions, yet one in which the perceived Western rival China has shown there is an alternative route: a diplomatic one.

The agreement of Iran and Saudi Arabia to restore diplomatic relations, brokered by China, is remarkable for bringing together countries that have backed opposing factions in several wars. It also makes the U.S. State Department and whoever is pulling the strings of the Washington administration look directionless, distracted and out of their depth.

While the White House was focused on the supply of fighter jets to Ukraine, and the training of Ukrainian pilots to fly F-16s that would drag the U.S. deeper into conflict with Russia, China was taking steps that can only be called practical and productive as an arbiter on the world stage.

Two contrasting approaches in response to uncertainty, monetary and social change, both of whose architects propose that citizens trade a degree of freedom for economic and physical security.

This is not to take sides, as explained below. The article does not argue from ideology but, since we face dire straits, asks how we avoid escalation.

Regulators on the run

War has often been the answer to economic crisis. U.S. foreign policy increasing looks like a distraction from an accelerating decline in living standards and social unease — and the powerful may yet decide it is the solution.

The Federal Reserve privately-owned central bank, and its client the U.S. Treasury, responded to the run on Silicon Valley Bank, Signature and others with what looks like massive money printing, a redo of the Covid money-go-round.

The banking system is already part of fifth generation warfare: it was weaponised against Iran under the Barack Obama presidency and against Russia under president Joe Biden. How long before banking is weaponised against the domestic population?

Governments notice what works to control foreign populations. Douglas Valentine, the author who described the counter-intelligence techniques used by the U.S. in Vietnam, writes that the means by which we wage war abroad eventually come home.

See Douglas Valentine, The Phoenix Program (1990) in Moneycircus — Eurasia note #53 - 100 Days & 8 Years Of War In Ukraine (Jun 4, 2022)

For Iran and Russia that meant being excluded from SWIFT and the seizure of assets. Canada’s truckers may have noticed the parallel.

The rescue of bank despositors brings respite but banks are not the only ones trapped. So are the Fed and the Treasury. Banks will be able to borrow unlimited money from the Federal Reserve, matched by government securities, so that they don’t have to sell them. Further money printing will fuel inflation and presumably interest rates, depressing bond prices — which was the cause of SVB’s woes in the first place.

In the past the U.S. could export inflation. This time it faces competition from Russia, China and other countries that are backing commodity and gold-linked currencies. More on this below.

The Treasury announced a new vehicle to bail out all depositors “eligible,” suggesting those covered by the Federal Deposit Insurance Corporation. Uninsured depositors will get an “advance” and a receivership certificate, for a share of what’s left after everyone else has been made whole.

This does not cover derivative bets such as those that brought down the banking sector in 2008 after the mortgage securities fraud. Thus the monetary system could still collapse.

As discussed in the last article, depositors could be bailed-in, a portion of their assets seized to save the banking system — for the greater good. Compensation or offset for that expropriation could come in the form of Universal Basic Income, a step towards the introduction of central bank digital currencies.

See Moneycircus — Bank Runs As Pretext For Financial Lockdown (Mar 12, 2023)

Rivals or collaborators

The monetary crisis, whose latest manifestation is a series of bank runs, is the driving force in the West behind the Covid response, the war in Ukraine, and the coming climate lockdown.

While the newspaper headlines are different, these crises are related because the response is the same: the evolution of lockdown, quarantine, propaganda and censorship, digital ID and track and trace corraling the people into 15-minute cities.

But aren’t all the countries working together — or does the threat of tyranny lie in corporations allying with governments?

Those seeking to make sense of these “cascading crises” understandably look for a common thread: that all major powers are signed up to the World Economic Forum’s plan for a Schwabian technocracy.

Yet China’s diplomatic initiative, like the war in Eurasia, represents a challenge to, and perhaps defeat for, unipolar politics. The U.S. could lose its petrodollar status at the very moment it needs it most: in order to maintain living standards threatened by debt-burdened government, inflation and deindustrialization.

Emerging markets — what the West used to call the Third World — have led the resistance to the World Health Organisation’s One Health, that seeks to over-ride national sovereignty using the excuse of pandemics to impose globally-mandated jabbing through a centralised control mechanism with the pharmaceutical industry sitting at the top.

Scientific dictatorship appeals to psychopaths — not only bad people in power but also corporations; for corporations are incapable of morality, and legally obligated to be amoral in service of their shareholders, regardless of what the environmental, social and governance (ESG) movement says.

Corporate psychopathy would also explain the readiness of Western countries to turn their backs on free trade agreements, including the World Trade Organisation, while refusing to compy with intergovernmental institutions when their findings conflict with the interests of the warfare industrial complex.

See Moneycircus — Vaccine Scandal A Case Study In Great Reset (Oct 18, 2022)

“Markets don’t like uncertainty; markets like actually totalitarian governments.”
— Larry Fink, CEO of one of the biggest corporate owners, BlackRock.

The risk is that corporations ally themselves with authoritarian governments. In his 2021 letter to the heads of large corporations, Fink wrote: “It’s important to recognize that net zero demands a transformation of the entire economy.”

There are factions within each country financed by corporations and their philanthropic fronts — pharmaceutical companies are the biggest lobbyists in financial terms.

What has happened is subsidiarity, a central tenet of democracy — that services should be governed at the most local level — has been captured and subverted.

Local government is filled with functionaries “digging the trenches for Agenda 21,” networked by professional organisations like Common Purpose, financed by billionaire foundations and intergovernmental institutions, thinking they are working for global betterment.

But that does not mean governments are monolithic, in turn forming parts of a monolithic global operation.

As for China, Minxin Pei, professor of government at Claremont McKenna College in California recently told the Financial Times: “I think the biggest change is really the collapse of China’s relations with the US in the past 10 years.”

Multipolar politics

Iran and Saudi state media jointly announced they will reopen embassies within two months. Their national security chiefs had met in Beijing, to be followed in coming weeks by foreign ministers.

It is not unexpected. In April 2022, Iran normalized relations with Saudi Arabia, the same month that the Saudi crown prince Mohammed bin Salman turned down a phone call from the president of the United States, as did UAE leader Sheikh Mohammed bin Zayed.

In December China’s president Xi Jinping visited Saudi Arabia for a summit of the Asian superpower with Arab countries.

It does, however, raise questions whether the U.S. will rethink its attitude to Saudi Arabia. The British helped put the Saud family in power. Can we be sure the Anglosphere will not be so presumptuous as to try to evict them, or at least to tarnish their name over conflicts like the Saudi war in Yemen?

Troubled waters

Is the Biden White House completely wrong-footed by a new Chinese tide in geopolitics or is the good ship United States being deliberately steered off course?