More and more top economists predict the end of dollar dominance
 
In the following is our translation of an analysis from RIA Novosti, based solely on data from US financial news sources, with commentary and notes [in brackets] by Vince Dhimos. Author Ivan Danilov points out that the standard fare in US financial and economic reporting has been to point out that, while the Fed had printed trillions of unbacked dollars at the time of the 2008-9 Great Recession, the USD pulled through just fine, so not to worry. However, Danilov reminds us there was no pandemic at that time threatening the US economy – which has so far lost about one-third of its size and has shed the last 5 years of economic growth just this year alone. With plenty of room for more loss. The upshot is that more and more prominent economists are piling on with the prediction that the dollar may well lose its status as the dominant world reserve currency. That didn’t happen after the QE’s of the Great Recession.
 
Our previous articles on this subject:
 
http://www.newsilkstrategies.com/economics-and-finance/thanks-to-feds-printing-press-investors-avoiding-us-dollar-collapse-coming
 
http://www.newsilkstrategies.com/economics-and-finance/deutsche-bank-economist-predicts-dollar-will-be-dethroned-possibly-replaced-by-rmb
 
http://www.newsilkstrategies.com/economics-and-finance/morgan-stanley-top-economist-predicts-dollar-crash-in-2021-will-america-learn-this-lesson
 
We have also been writing since 2017 about the efforts of non-US-aligned countries to de-dollarize world trade:
 
http://www.newsilkstrategies.com/news--analysis/look-whos-r-e-a-l-l-y-edging-out-the-dollar
 
Now that Trump has gone off the deep edge with sanctions on just about everyone, including old faithful allies, there are many countries that have been seething for revenge, looking forward to what is happening right now to the USD. No matter what happens, if the dollar crashes, it will be a bitter-sweet experience for us all.
 
BEGIN TRANSLATION
 
"Vampire Squid" Sounds the Alarm: The Dollar Will Be Dismissed As World Currency
 
7-31-2020
 
Ivan Danilov
 
A major American bank, known for its political influence and the fact that dozens of high-ranking officials around the world are its former employees, has issued a shocking statement: the dollar's status as the world's main currency may come to an end.
 
Goldman Sachs is a well-known structure in financial circles that manages a trillion dollars in assets, is highly respected on Wall Street, conveys its ex-employees to high positions in the US Treasury by the conveyor belt method, and also has a dubious distinction, a corporate nickname, the “Vampire squid,” a label applied with the light hand of investigative journalist Matt Taibbi after the 2008 crisis. "The first thing you need to know about Goldman Sachs is that it is everywhere. The world's most powerful investment bank is a huge vampire squid wrapped around the face of humanity, mercilessly squeezing its bloody beak into anything that smells of money," he wrote in an extensive investigation published in The Rolling Stone magazine in 2010. And since then, it is this description that has haunted the reputable American financial structure.
 
For the above reasons, when the "Vampire Squid" comes out with some kind of public position, especially in those cases when his assessment is very different from the ideas of the mainstream media class about what is possible, you have to listen to this position.
 
The American bank's criticism of the dollar's prospects as a world currency is doubly surprising because even global financial structures "registered" in the United States have a specific, but very noticeable patriotism, which they periodically back up with generous donations to future senators and congressmen. In a sense, Goldman Sachs is America, and to be more precise, it is modern America that has moved away from the machine and is deeply involved in financial manipulation. Once the symbol of the United States was not a bank, but the industrial corporation General Motors, of which Secretary of Defence Wilson said: "What's good for General Motors is good for America." Now the symbol for the United States is not a production company, but an investment bank that periodically paints its logo in minority colours, has a reputation as a deeply immoral but influential structure and is now very worried about the future of the American currency, whose problems will seriously affect prospects for America as a whole.
 
US financial information agency Bloomberg restates analysts' fears at the reputable bank: “Goldman Sachs Group Inc. took note of suddenly heightened concerns about US inflation by issuing a bold warning Tuesday that the dollar was at risk of losing its status as the world's reserve currency.
 
As Congress moves closer to yet another round of fiscal stimulus to prop up the pandemic-ravaged economy, and the Federal Reserve has already increased its balance sheet by about $2.8 trillion this year, Goldman strategists warned that US policy raises "currency depreciation fears." which could end the dollar's dominance as the dominant force in the world's foreign exchange markets."
 
We must pay tribute to the analysts of Goldman Sachs: back in the spring, when the printing press of the US Federal Reserve was just beginning to work overtime to support the financial markets and the US budget in an epidemic, and Congress and the Senate reflected on the size of budgetary injections into the economy and the accompanying increase in the deficit, the bank held special meetings with its clients urging them to exchange dollars for gold (or even Bitcoins) based on the risk of impending inflation. Now the bank has decided to bring the same problem to the widest possible audience, and it has done well – almost all the world's leading media have written about the dollar's likely loss of its status as the world's main currency.
 
Of course, it should be borne in mind that (as the same Bloomberg and other media commentators rightly note), “in most financial circles, this point of view is still a minority – and Goldman analysts do not say they believe this (depriving the dollar of the status of the world reserve currency. - Author's note) will definitely happen."
 
A typical position of this nature is that the US dollar "is not even close to losing its reserve currency status, given the depth of capital markets and the overwhelming volume of global transactions that take place in US dollars," Michael Krupkin, head of foreign exchange, in North and South America of British bank Barclays, told Bloomberg.
 
The problem is that when the majority of the American analytical community starts to adhere to this position, it will be too late. In the sense that the process of dismantling the world system based on the dominance of the American currency will either be completed or have already passed the point of no return.
 
Another argument in favour of the fact that the dollar system will outlast all its critics is the fact that it was able to survive the last "bout" of unrestrained money-printing performed by the Fed in 2008-2009. The problem with this argument is that the intensity of the printing press is nowhere near what happened during the last crisis and that in 2008-2009, the United States was the undisputed leader of the unipolar world. [Yes, and the pandemic is not nearly over. The Fed will likely be printing up trillions and trillions more before it is all said and done. And meanwhile, now that the government has stopped boosting the unemployment payments, the economy will slide even farther as people tighten their belts and spend even less. Some economists are also saying the trade war with China is causing investors to lose confidence in the US dollar. The time has come to stop worrying about China and look in the mirror]
 
This time around, the situation looks completely different: American cities are on fire, both leading parties are talking about the likelihood of non-recognition of the results of the next presidential election and a possible civil war, and there is no longer a unipolar world – and the only question is what form Cold War 2.0, already started between the United States and China, will take ...
 
The wise and well-informed "Vampire Squid" is sounding the alarm for a reason, trying to appeal to budget discipline and protection of the system that has given the United States colossal privileges over the past 50 years. The warning of an influential bank will surely be heard, only now there are serious doubts that American politicians are capable of taking those unpopular steps that will require the preservation of the dollar as the main world currency.

I have been warning for some time now about the danger that the US dollar faces. For one thing, the weaponizing of the dollar with the heavy handed use of sanctions has forced countries threatened by sanctions to seek a work-around to the US-controlled SWIFT system. Europe opted for INSTEX, which enables it to trade with Iran without being detected.  China and Russia have developed a method of swapping yuan and roubles. Russia and China made a $400 billion pipeline deal for delivery of gas to China for several years. All of this and much more has led to a decline in the use of the USD in foreign trade settlements. And economists know that the less the dollar is used in foreign trade, the less it is worth.
 
Now, thanks to the pandemic, the Fed is issuing trillions in unbacked dollars as an emergency measure, most of which goes to billionaires in businesses affected by the pandemic. Much of this is being sunk into the stock and bond market, where it will do nothing to mend the economy.
 
Economists like former Morgan Stanley top economist Stephen Roach and Deutsche Bank’s Asia specialist Shameer Goel warned recently that the US dollar would lose value as a result of this rampant dollar printing. In fact Goel predicted that the dollar would lose its dominant position as a world reserve currency. Now we are seeing the first signs of this happening.
 
The Economic Times of India ran two reports on this, here. Some quotes:
 
“The dollar’s strength is well and truly over for now,” said George Boubouras, head of research at hedge fund K2 Asset Management.
 
“The dollar fell against all its Group-of-10 peers on Monday, with the Japanese yen and Norwegian krone rising 0.6% and the Swedish krona gaining 0.7%. The Bloomberg Dollar Spot Index dropped as much as 0.8%, extending four weeks of losses, the longest streak since early 2019.”
...
“The euro is another potential candidate for money managers seeking safety. The currency’s surge past $1.17 to levels not seen since September 2018 could be the beginning stages of a shift toward the euro zone after the union banded together to agree on a historic recovery fund.”
 
This latter quote corroborates an observation I made back in July 2017, here about the possibility of the euro edging out the dollar.
...

“The dollar should continue making new lows,” said Win Thin, global head of currency strategy at Brown Brothers Harriman, who sees the euro testing September 2018 highs. “The economic underperformance of the U.S. is likely to feed into continued underperformance of the dollar.”

The weakness has been so pronounced that it’s drawn comments from the likes of billionaire investor Ray Dalio, who says the conflict between the U.S. and China would further harm the dollar.


“U.S. exceptionalism has eroded, the Fed is in a mind-set of restoring jobs at the moment and it’s going to drive them to provide potentially more policy accommodation,” said portfolio manager Stuart Simmons. “That’s all dollar negative.”
 
Finally, I need to point out that, since no V-shaped recovery is expected, the Fed will almost certainly see it necessary to print more unbacked trillions. One observer said it would probably print one trillion per month in the event of a second wave of COVID infections. Now if the trillions printed so far since the onset of the pandemic have already spooked investors not to invest in the US dollar, imagine what must lie ahead. And once the dollar is dethroned as the world’s dominant reserve currency, it is hard to imagine it ever being restored after that.
 
The pandemic was not the US government’s fault. But the policy of throwing trillions at wars and arms was a constant of US politicians for decades. Now in retrospect, perhaps the politicians who spent all this cash they didn’t have may regret not having put some aside for a rainy day. The way China and Russia have been doing for many years.

Vince Dhimos answered a question at Quora:

https://www.quora.com/With-the-deteriorating-US-and-China-relations-how-will-the-US-economy-be-affected/answer/Vince-Dhimos

With the deteriorating US and China relations, how will the US economy be affected?

Vince Dhimos

Westerners ignore a key fact, namely, that China does not depend on the US for its income. It has very significant sources of income all over the globe and basically, cannot be stopped by anything the US may do.

While the US relies in large part on China, for cheap goods and for key roles in the supply chain, China can go on forever without the failed state of America,

The US is losing not because of deteriorating relations with China. It is losing because of chronic mismanagement of its resources and because it chooses politics over real world solutions.

It will be that way in Trump wins in November and it will be that way if Biden wins. Biden has promised to be “tougher” on China than Trump. That makes two failed leaders with no strategy to solve the economic and health crises. If they had had a strategy they would not be spending all their time bashing China. Nothing can save America now.

END OF MY RESPONSE

Anthony Han commented because my answer was short. I was low on time and I omitted important details. My intra-textual notes are [in brackets].

Anthony wrote:

https://www.quora.com/With-the-deteriorating-US-and-China-relations-how-will-the-US-economy-be-affected/all_comments/Vince-Dhimos?__nsrc__=4&__snid3__=10145233178&comment_id=151664223&comment_type=2

What is missing in your answer is that the world is still very much reliant economically and financially on US dollars (USD) as the global currency. So for China to import crude oil by millions of barrels per day and grain and meat as it cannot feed itself, it needs USD. 

[Prior to the pandemic, Russia was exporting a lot of food to China, and China did not need USD to buy. The deal was settled in yuan. Russia has, however, temporarily suspended wheat exports]

https://www.dccchina.org/2019/06/more-russia-food-drink-exports-to-china/

Those countries that want to sell oil and food wants to get paid in USD so they can buy what they need from other countries (who also want to get paid in USD). [Not true, as shown above- It’s not Anthony’s fault that he does not know this because Western media are mum about the intensive dedollarization efforts in Asia and Europe and elsewhere.]

Where do countries get US dollars? Why selling stuff to Americans.

The stuff America buys from China can eventually move to another country as they don’t involve anything proprietary to China. I am not saying that there won’t be a period of adjustment and dislocation. And this is already happening as wage rates in China has risen and low value manufacturing is moving to lower cost countries.

But China must still earn USD in order to survive and prosper. This is why China cannot live without the US but we don’t need China. China needs to move up the value chain by selling more advanced products in order to remain solvent. [Actually, economists credit China with saving the world economy during the 2008-9 Great Depression that the US caused with its incompetence, so yes, the US needs China]

Why can’t China’s currency, the RMB, replace the USD? Couple of key reasons. China has flooded its domestic economy with RMB to keep it from collapsing and as the result it has become worthless as an international currency. How worthless? They have to restrict its convertibility to USD to avoid every Chinese from dumping their RMB for USD and bankrupt the country. Remember USD for every country in the world except the Eurozone is like having gold in the old days. Except for the US and the Eurozone (and the Yen) your own currency is no good outside of your own country. [absolutely false, see below]

The other reason has to do with the fact that the country that provides the global currency (aka reserve currency) has to run a huge trade deficit forever. The reasons are complicated but you can look it up. China is an exporting economy and does not want that to happen. US can afford it better because it is so blessed that it really does not need to export to maintain full employment [unemployment is dangerously high now in the US]. But it has cost jobs in our industrial sector but not in the entire economy as a whole. Obviously having our currency be the global currency gives the US huge advantages because we print the stuff. Imagine all those hard working Chinese folks selling us real things in exchange for USD that we can create out of thin air! [Top economists are now saying this magic is wearing off during this pandemic because the Fed has overprinted and investors are turning to alternatives to the USD]

That is the REAL power of America. [Actually, it is fake power]

The fact that you believe that America needs China more than China needs America suggests that you may want to learn more about the true nature of how the world works. [It is dangerous to get your news by reading all Western sources]

https://www.quora.com/With-the-deteriorating-US-and-China-relations-how-will-the-US-economy-be-affected/answer/Vince-Dhimos/comment/151689217

Vince Dhimos Origial Author 
 
I am not talking about the world’s temporary reliance on the USD because it is a TEMPORARY situation. You admit that when you say “the world is STILL reliant on the USD.” If this were a permanent situation, you would not have used the word “still.” What you do not see are the road signs all around you. Russia and China signed a $400 billion deal for pipeline-delivered gas — the famous Power of Siberia — and they did not make the deal in dollars at all. Iran signed a major deal with China for supply of oil, and the deal is denominated in yuan (China-Iran Oil Deal Undermines the Dollar). Europe has developed a work-around to the once all-powerful SWIFT system. The new system is called INSTEX. It will enable Europe to trade with Iran and other pariah countries in euros. Iran just sent millions of gallons of gasoline to Venezuela. Did you think Venezuela paid in dollars? It would have been impossible because the US would have forced SWIFT to refuse the transaction. And what about the Nord Stream 2 deal? Did you think Russia will be selling its gas in dollars? No, the deal is to be settled in euros. And now that the pandemic is upon us, the many countries interested in the de-dollarization of world trade will use the pandemic to leverage their efforts and edge out the dollar in as many transactions as possible. They have the wind at their back. Deutsche Bank economist Shameer Goel predicts that this pandemic will dethrone the dollar, which he says could be replaced by the rmb as the world’s primary reserve currency. After all, the digital rmb is on the way. I don’t blame you if you did not know these things, because most Western media covering these international transactions do not mention the currencies used. They are trying desperately to cover up the danger to the USD.

 
Anthony Han

I am aware of these attempts. But those are exceptions that prove the rule. Outside of the Eurozone, the USD is still 90% of the medium of exchange. Barter deals will continue but they are not efficient.

I agree that it’s not entirely good for any country including the US to be chosen by others as the reserve currency. It forces account deficit and trade deficit on the chosen country. So it isn’t the US that has chosen the USD, but the world. It is actually a burden though with benefits.
I don’t believe that you have a grasp of the economic disaster happening in China that makes it impossible for the RMB to serve as the reserve currency [I note that you provide no details on this “economic disaster.” But if there is such a disaster, how is it possible that China has been averaging 6-7% economic growth for decades vs less than half that for the US? And how is it that China is the only industrialized country that has reported positive growth this year, while the US has shown disastrous negative growth, like the rest of the West?]. And the PRC also do NOT want the burden that come with it since it’s economy is still only at a middle income stage. Perhaps in another 20 years who knows but that time has not yet arrived.

Germany relies on exports for 50% of its GDP, and has used its influence to prevent the Euro from replacing the USD outside the Eurozone. As that would make it impossible for Germany to remain an export oriented economy. It is not an exaggeration to state that Germany holds the dominant voice in these matters within the EU.
The Japanese Yen can play a role but its economy is too small and the Japanese government has resisted all efforts by other countries holding the Yen as a reserve currency as well.
One of the negative consequences of being used by other countries as a reserve currency is that it appreciates against all others. Other countries sell their currency to buy the reserve currency. This is really bad if you want your country’s companies to sell abroad.
So what you are talking about is not a significant factor in the broad picture. China will continue to need to earn USD in order to survive let alone prosper. In fact as PRC become more aggressive and heavy handed as has happened recently, even the EU will begin to work to balance against that aggression and these alternative options to the USD will go away.

Vince Dhimos

Original Author 

“In fact as PRC become more aggressive and heavy handed as has happened recently, even the EU will begin to work to balance against that aggression and these alternative options to the USD will go away.”

The narrative that the PRC is heavy handed is part of the pre-election propaganda and is not an established fact. “Heavy handed” is a relative term and must be measured against the degree of heavy handedness of the US and its puppet states, because these are the parties bringing these charges in their non-stop anti-China propaganda. The US has so far slaughtered over 10 MILLION mostly civilians and has killed with its sanctions an unknown number of civilians in countries with leaders that refuse to bow to the Washington bully. THAT is heavy handedness and China has never committed, and will never commit anything close to these atrocities, so it is hypocritical of a pro-American commentator to criticize China for heavy handedness. But the main thing is that other countries, including very powerful ones, have not fallen for this propaganda and oppose it strongly. The contention is between the pro-American countries on the one hand and, on the other hand, these powerful non-US-aligned Eastern countries — and also countries like Germany which vehemently oppose the HEAVY HANDED US sanctions on Nord Stream 2, as well as Venezuela, which no longer uses the dollar in its foreign trade. Whether you agree or disagree with their viewpoint, you can’t afford to underestimate these opponents of US hegemony — or their ability to gradually de-dollarize world trade. Nor can you afford to underestimate the damage the US, especially the Fed, is doing to its own position in the world and its own economy. This pandemic era has changed everything. The US has so far proven woefully incapable of coping. That is why US politicians must rely on anti-China, anti-Russia, anti-Iran, anti-Venezuela etc rhetoric to get votes — they have no strategy to overcome the economic and health crisis. Printing unbacked dollars is not a strategy, it is an admission of defeat and impotence.

by Vince Dhimos
 
If you have been watching the trade war and the hate campaign against China and if you have noticed how this is working out for the West, it must have occurred to you by now: Is it economic suicide? Or are Washington politicians really brain dead (notice I did not use the s word – starting with stu, ending in pid. I’m trying to be nice)?
 
Let’s just do a cursory review, shall we?
 
Sanctions on Rusal shake global aluminium markets
 
In April 2018, the geniuses in Washington slapped sanctions on Rusal, a large Russian aluminium company supposedly to punish CEO Oleg Deripaska, who was accused of various crimes for which there was no evidence, just rumours, and which, even in the event he had committed them, would not have affected anyone in the Western world anyway. The sanctions immediately impacted the US aluminium industry because Rusal manufactured ingots, not finished products, and US aluminium companies had been relying on these cheap Russian made ingots to elaborate finished products such as castings, forgings, extrusions, etc. US aluminium manufacturers warned that if the imports were not restored soon, they would be going bankrupt. Finally, after almost ruining the US aluminium industry, Washington lifted the sanctions in January 2019 against the wishes of the Democrats in Congress, who put harming others far above the health of the US economy.
 
Bloomberg ran an analysis of the incalculable damage done by the Rusal sanctions to a host of Western industries and investment bankers and to the global supply chain. None of these things interested the US lawmakers who meddled in the aluminium trade and hence, in their own economy. This illustrates why US politicians are the biggest enemy of their own, and the global, economy. Remember that neither Russia nor China – nor any other country in the world – deliberately undermines its own economy to punish another country.
 
If Biden is elected in November, the sanctions on Rusal could be re-imposed.
 
The war on Huawei disrupts the electronics industry’s supply chain
 
Then came the Trump trade war with China, which carried on the effort to undermine the economy, supposedly to punish China for misdeeds that were for the most part unproven – and to prevent Chinese companies from the alleged intention to use exported electronic devices to spy on the US. Again, as in the Deripaska case, there was no evidence of any such intentions to spy or of the damage they might have caused the US in the outside chance they might exist. But anyway, the real goal was to hurt China as part of the US’s zero-sum strategy.
 
The epicentre of the war is Huawei, a company that has been more technologically advanced than any US company.
 
US politicians, who know a lot about manipulating their voters but nothing about economics, were so paranoid about the potential for this company to strip the US of all its precious secrets that they began bullying their allies not to trade with Huawei, or else. Trump managed to bludgeon the UK into submission with threats of sanctions, and London was forced to cut Huawei out of the major share it was to have in the UK’s 5G rollout. By reneging on its original contract with Huawei and stripping Huawei components out of its 5G project, the UK probably lost billions of pounds sterling at a critical time when no trade agreement has yet been reached with the EU. Finian Cunningham writes:
 
“The British government admits that this reversal will result in delays for modernizing the country’s telecoms services – seen as vital for economic development – and will add huge costs of up to £2 billion ($2.5 bn) for eventual replacement. Something which taxpayers and consumers will no doubt have to pay for.”
 
Now, you will admit that forcing trading partners to lose enormous amounts of money is not an economic strategy. Nor is it a viable diplomatic strategy that might improve US-UK relations.
 
But it gets worse
 
As part of its war on Chinese electronics, the US banned the sale of electronic components to Huawei and ZTE, and this ban extended to non-US companies, such as notably Taiwanese chip maker TSMC. Predictably, as with all unconsidered actions aimed only at hurting someone but without benefiting the US economy, the ban did not have its desired effect.
 
Firstly, it deprived US and other Western manufacturers of a lucrative customer and cost them money. Just like the Rusal sanctions, it was a shot to the foot.
 
Secondly, it caused the resourceful China to start manufacturing more of its own chips, which, according to CNBC, caused a 245% surge in the shares of Shanghai chip maker SMIC.
 
China’s response to the US restrictions is a perfect illustration of the difference between the Chinese win-win and the US zero-sum strategy.
 
While the US, in its attempt to undermine the Chinese economy, winds up hurting its own economy and the economies of its allies, China’s “retaliation” ends up making China stronger.
 
It’s easy to see who wins in the long run.

Vince Dhimos answered a question at Quora.
 
https://www.quora.com/How-is-Chinas-strategy-different-from-the-US/answer/Vince-Dhimos
 
How is China's strategy different from the US’?
 
Vince Dhimos Editor-in-Chief at New Silk Strategies (2016–present)
 
The US strategy is zero-sum while the Chinese strategy is win-win.
 
Even without real world results, it is easy to see that zero-sum is bull. The theory is that if the US can harm another country’s economy, the US then automatically becomes stronger and richer. If this were true, then the Fed would not have been reduced to printing unbacked currency starting after the Great Recession in 2008–9 and it would not be measuring its economy in terms of stock market prices, which reflect a dangerous bubble. Clearly, the misfits who run the US have no idea what they are doing and that is why they keep blaming China for their own failures.
 
The Chinese win-win makes sense not only in theory but also in the real world and is the reason by China has had 6–7% GDP growth for decades.
 
Just to give you an example, win-win would mean that if China helps lift an African country out of poverty, that country gets richer and can buy more Chinese goods and services and will become a loyal trading partner. No hokus-pokus here at all. A 7 year old could understand it.
 
Last year, despite the trade war China had 6.1% GDP growth, vs 2.3% for the US.
 
This year, China was the only economy to show positive growth, while the US virtually crashed.
 
Win-win works.
 
Zero-sum is clearly for losers.
 
The amazing thing is that the US, instead of emulating China’s winning strategy, keeps repeating its old failed strategy. And the really bad news is that neither party has shown any common sense in economics.
 
Biden has promised to get even “tougher” on China. He is Trump on steroids.
 

Vince Dhimos answered a question at Quora.
 
https://www.quora.com/Why-doesnt-Europe-abandon-the-USA-and-NATO-and-accept-the-Chinese-world-order-Wont-the-world-be-a-much-more-prosperous-and-peaceful-place-if-it-shuns-the-USA-and-its-warmongering-ways/answer/Vince-Dhimos
 
WHY DOESN’T EUROPE ABANDON THE USA AND NATO AND ACCEPT THE CHINESE WORLD ORDER? WHY DOESN’T EUROPE ABANDON THE US AND NATO AND ACCEPT THE CHINESE WORLD ORDER?
 
Editor-in-Chief at New Silk Strategies (2016–present)
 
A recent article in Bloomberg shows that the first step toward your dream may in fact come true. Germany Weighs Measures Against U.S. Over Nord Stream Threat
 
In fact, Germany’s refusal to pay the exorbitant amounts assessed by Trump toward the upkeep of NATO forces in Germany is a first step in pulling away from that protection racket. (https://www.quora.com/Why-hasn-t-NATO-evaluated-its-peacekeeping-experience-to-identify-and-implement-best-practices-for-transitioning-failed-states-into-functional-democracy/answer/Vince-Dhimos).
 
Bloomberg writes:
 
“Chancellor Angela Merkel’s administration is considering pressing for coordinated European Union action, according to two German officials familiar with the discussions. An economy ministry paper seen by Bloomberg News said such measures by the U.S. would be new and could hit significantly more German and European companies and banks as well as state agencies.” [This refers to the new US sanctions against Europe. Vince]
 
Some background is in order. Germany is the acknowledged leader of the EU. In fact, former German defence ministress Ursula Von der Leyen is now the president of the EU Commission, the body that makes the really important decisions and decides which issues get voted on. It is reasonable to expect her loyalty to her own country to play a role.
 
As for the China part of the question, while Europe can’t afford to abandon the US completely, a China-EU summit has been held as a video conference. The US is already too openly hostile to China for a US-China summit to take place.Brookings Institution highlights the differences between the US and EU approach to China. The future of trans-Atlantic collaboration on China: What the EU-China summit showed.
 
According to that report, the EU is not about to wage any kind of trade or other economic war with China, despite EU misgivings about Chinese governance. This approach has the advantage over the US because China, despite US objections, is inextricably tied to its partner countries, including the US. The Trump idea of complete decoupling can only harm the US. And of course, the harder Trump pushes against China and pushes the EU to join in its anti-China policies, the harder the EU will push back against the US. This forms the back drop of the planned German and EU sanctions against the US.
 
The issue behind the new move toward independence of Europe is the US sanctions intended to kill the Nord Stream 2 project based on a legally binding contract between Russia and Germany for the laying of a pipeline and the supply of natural Russian gas to Germany. The sanctions already caused the main pipe-laying company Allseas to suspend its work with only 6% of the pipeline remaining to be laid. It was a sleazy dirty trick on the part of the Trump administration and the US Congress and Senate. Although the US bases its move on the ridiculous idea that buying Russian gas puts Europe’s “energy security” at risk, the scarcely hidden ulterior motive is the desire to sell US LNG to Europe. The absurdity of the US pretext is obvious when you consider that US LNG costs 40% more than Russian pipeline-delivered gas. It boggles the mind. And it infuriated Germany.
 
Now that Merkel will be the wizard behind the EU curtain, there can be no doubt that both German national and EU supranational measures will be taken against the US for its brazenness.
 
This stands geopolitics on its head, with the sanctions bludgeon now in the hands of Europe and with the US on the receiving end.
 
What has gone around has come around.
 
WAR NEWS
 
 
Russian Hmeimim airbase swats down dozen missiles fired by Turkish-backed jihadists
 
https://avia.pro/news/neozhidannyy-manyovr-rossiyskih-pvoshnikov-v-sirii-zastavil-turciyu-drozhat-takogo-erdogan-ne?utm_referrer=https%3A%2F%2Fzen.yandex.com&utm_campaign=dbr
 
Since Turkish proxies are attacking Russians and Turkey is a proxy of the US, you can say that the US and Russia are at war with each other. Russia has superior air power.
 
Sudanese would/be mercenaries arrested
 
https://www.almasdarnews.com/article/sudanese-forces-arrest-dozens-of-mercenaries-en-route-to-libya/?utm_medium=ppc&utm_source=push&utm_campaign=push%notificationss&utm_content=varies
 
Like all US wars, the attack on Sudan ordered by Bill Clinton in Sudan in 1998 was based on a contrived pretext and most observers agree it – along with an attack in Afghanistan – was done to divert attention away from the Lewinski scandal. As I always say, the US has no department of defence. Its engagements are always offensive and criminal so that department should be properly named as the Department of Offense.
 
It is interesting to note that Sudan, which was humiliated by Bill Clinton and attacked for no valid reason at all should now support the forces of Khalifa Haftar, who opposes the “government” of Faez Serraj in Tripoli which exists solely at the pleasure of the UN and the US and has no democratic legitimacy whatsoever. It was Hillary Clinton who headed the State Department when the heinous murder of Ghadaffi by the US-NATO threw Libya into chaos and opened its doors to the terrorists who are now fought by Khalifa Haftar and supported by Serraj, so it is only fitting that Sudan should support Haftar by supplying him with weapons.
 
Once more, the Washington war machine ignored the fact that even weak nations that it attacks can eventually find a way to fight back.

https://www.quora.com/Would-the-EU-be-better-off-with-Russia-or-should-they-stay-close-to-the-USA/answer/Vince-Dhimos

Would the EU be better off with Russia, or should they stay close to the USA?
 
Vince Dhimos
 
Editor-in-Chief at New Silk Strategies (2016–present)
 
The question implies that the EU must either accept Russia or the US. But that is not the issue. It’s like saying: Should the US choose Canada or Mexico. Well, both of course.
 
Some Westerners think Russia is of no use to Europe. Some even claim that Russia has a non-European language and culture and its history had nothing in common with Europe.
 
All of these are fallacies of people with a limited outlook and knowledge of history and culture and suffering from the dread psychological disorder of hyperpatriotism. And these fallacies are nurtured by the US propaganda factory that is based on the NATO raison d’etre, namely that Russia is — supposedly — the enemy of the West. This in turn is nurtured by the myth of “Russian aggression,” which I debunked here:
http://www.newsilkstrategies.com/military-affairs/the-real-aggressor-is-not-russia-its-the-us
 
Want to talk language and culture? As a Slavic language, Russian is part of the same Indo-European family as English. As for culture and history, ever hear of Swan Lake? The composer was Russian. Chekhov? Dostoyevsky? They were Russian. The inventor of television at RCA was also Russian. Lev Tolstoy? His novel War and Peace is about what the Russians call the Great Patriotic War of 1812. The allies of Russia included Prussia and Austria. France lost ignominiously. Later Napoleon would be defeated again, this time at Waterloo in Belgium by a coalition consisting of Britain, Netherlands, some German states and Prussia. Later, the US would ally itself with a group of nations including Russia to fight WW II. Russia killed 3 out of every 4 of the Nazi troops killed in that war and it also liberated Auschwitz, although the West refuses to give it its due credit. Mike Pence, in his speech in Europe commemorating the end of WWII, could not bring himself to say that it was the Red Army that liberated Auschwitz. He only managed to mutter that it was freed by “soldiers.”
 
Let’s look at Russia’s usefulness. At this moment, Russia and Germany have a signed contract for the laying of a pipeline called Nord Stream 2 from Russia to Germany and for the supply of natural gas at a rate sufficient to supply all or most of Germany’s gas needs. Now Germany is the world’s second biggest exporter after China and it needs affordable gas to run its economy. NOTE: Russian gas delivered by pipeline is 40% cheaper than US LNG.
 
So let’s see how useful the US is to Germany and the EU, or in other words, how much better off Europe is with the US.
 
For several years, Richard Gernell, Trump’s ambassador to Germany, has been haranguing that country to desist from buying Russian gas and buy the 40% MORE EXPENSIVE US LNG. The reason? According to Grenell and the Trump administration, buying Russian gas is a threat to European “energy security.” What Grenell won’t admit is that buying overpriced energy is the biggest threat of all the German industry because it would ruin the export business that fuels the German economic locomotive that in turn powers the EU. Without this economic powerhouse, the EU would be in even more trouble than it is already (it is deeply indebted and running a huge budget deficit). Now THAT is REAL energy insecurity. The phony US claims that by relying on Russian gas, the EU would be susceptible to pressure from Russia. But Russia has never tried to use its energy exports to pressure Europe. Yet the US uses the extravagant privilege of its dollar to pressure Europe in ways that threaten its economic competitiveness. This nonsense about Russia threatening its “energy security” is therefore rank hypocrisy! Yet based on this nonsense, the US Congress and Senate have approved sanctions that killed this pipeline project with only 6% of the pipe left to be laid. This US pettiness and mean-spiritedness cost Europe billions.
 
Worse, Trump has been pressuring Germany for years to pay extravagant amounts of its GDP to NATO. And yet, if we examine this situation closely, we see that NATO is nothing but a protection racket, claiming that Russia is a threat so as to extort money from Europe and force the continent to buy overpriced underperforming US-made arms (a good case in point is the F-35 “stealth” fighter-bomber, which flies slower and has a shorter range than its counterpart, the Russian made Su-35, of which Russia has already sold 20 to US ally Egypt).
 
Added to this list of economic threats is the absurd US-imposed sanctions on Iran, with which Europe has always enjoyed healthy and profitable relations, and the sanctions on Russia which Europe imposed under pressure and threats to Europe. These sanctions have led to multi-billion euro losses to the European economy. We might also mention the absurd US protection of its wayward ally Turkey, which has sent Syrian terrorists to Europe and is now sending ISIS militants to Libya, which is causing more immigration there that threatens Europe. Of course, let’s not forget the US invasions of Iraq and Libya that opened the floodgates of immigration to Europe in the first place, causing billions of euros worth of damage to various European economies.
 
The US has also pressured Europe to refrain from using Russia’s arctic shipping route between Asia and Europe, which saves considerable shipping distances and costs over the lengthy and time-consuming route via the Suez Canal. And let’s remember how the US pressures Europe to refrain from its once-lucrative cooperation with Chinese tech companies on the absurd fabricated excuse that the Chinese could somehow use its components to spy on Europe. What hypocrisy, when it was the US, not China, that spied on Angela Merkel’s cell phone a few years ago!
 
Here again, the US is undermining Europe’s economy by foisting NATO membership on it. Not only that, NATO, which slaughtered, 4,000 EUROPEANS in the 1998–89 Kosovo war, is a very grave exisential security threat to Europe. So how does Russia compare to this? Unlike US-led NATO, the Russian Federation has never once launched an attack or invasion in Western Europe. I have posted a response on Quora outlining NATO’s grave existential threat to Europe: https://www.quora.com/Why-hasn-t-NATO-evaluated-its-peacekeeping-experience-to-identify-and-implement-best-practices-for-transitioning-failed-states-into-functional-democracy/answer/Vince-Dhimos
 
Thus we see that the US threatens Europe’s economic security and its physical security, while Russia does not threaten either one!
 
Objectively speaking, there is absolutely no reason that Europe should continue its relationship with the US and refrain from entering into security agreements and economic agreements with Russia. In fact it would save billions if it stopped buying the overpriced US-made weapons and bought all of its arms from Russia instead. This would in turn stimulate the exportation of autos and other European products popular in Russia.
 
Finally, there is the issue of the US dollar, which, according to renowned economists such as ex Morgan Stanley top economist Stephen Roach and Deutsche Bank top economist Sameer Geol, is likely to be dethroned as the primary reserve currency after the second wave of the COVID pandemic. All of the above makes any alliance with the US economically toxic.
 
 

Deutsche Bank analyst warns US dollar may be dethroned as primary world reserve currency, possibly replaced by RMB

In the following you will find our translation of an article from rueconomics.ru with this foreword and intra-textual notes [in brackets] by Vince Dhimos. Many of the articles we publish in translation from RIA Novosti and rueconomics.ru are analyses by Russian experts of opinions and reports from the Western press, particularly financial journals. This one relates to a stunning statement by an analyst of Deutsche Bank that a second wave of the COVID pandemic could dethrone the US dollar as the primary world reserve currency and see it possibly replaced by the RMB. Needless to say this would be the most resounding possible slap in the face to all the US politicians who badmouthed China and did their darnedest to maintain the power and prestige of the US economy by simply undermining China. The fact that China is the only country that, amidst the COVID crisis, has actually shown some economic growth in contrast to the severe erosion of the US GDP foreshadows this possibility – the untimely death of MAGA and a nightmare for the US politicians on both sides of the aisle who wish China ill based on their zero-sum pseudo-religion.

The author is referring to the Business Insider article linked here:

https://markets.businessinsider.com/news/stocks/deutsche-bank-investor-demand-us-dollar-waning-2020-6-1029329462

Of course, in world affairs, nothing is predictable. For instance, if a cure or vaccine were found soon enough, the Fed may not feel obliged to “print” more trillions. However, there is no hint at this point that such is in the cards.

Vasiliev predicted what currency will replace the dollar after its collapse

June 26, 2020

https://rueconomics.ru/449441-vasilev-rasskazal-kakaya-valyuta-smenit-dollar-posle-ego-krakha

The weakening of the dollar as a world reserve currency will change the direction of the global economy, the chief researcher at the Institute of the USA and Canada, Doctor of Economics Vladimir Vasiliev, told FBA Ekonomika Segodnya.

Sameer Goel, Deutsche Bank’s chief macro strategist for the Asian market, warned in a CNBC interview that investors would reject the dollar if a second wave of the coronavirus pandemic begins. According to him, the exit strategy for the United States looks poorer than that of other countries.

Sameer Goel made this statement after a sharp spike in new cases of the disease was recorded in the United States at the end of last week. So, on June 19 and 20, 2020, according to Johns Hopkins University, more than 30,000 [new] cases were detected, which was a record and shocking daily increase since May 1, 2020. On Sunday, June 21, 27,476 new cases of COVID-19 infection were reported in America.

“The alarm forecast of Deutsche Bank should not be understood as a prediction of the collapse of the US national currency, but as a foreshadowing of its dethroning as a global reserve currency. A weakening of the dollar is being observed – at least in relation to the renminbi. In the case of the euro, parity is possible, since European countries that are part of the Eurozone are pumping in at least as much money, and therefore the euro does not have much circulation outside the specified area.

In this regard, the alleged collapse of the dollar is a signal to the Federal Reserve System, which got carried away with pumping dollars into both the American and the global economy,” says the expert.

A new reality for the global economy

Vladimir Vasiliev notes that today the US Federal Reserve has lost its autonomy and is dependent on the intentions of the current American president.

“The features of the Fed’s foreign policy demonstrate a reaction to signals from the White House, which is playing all-in. Donald Trump is ready to pump the world full of dollars, since it is important for him that by the fall of 2020, when the US presidential election is due, the country's economy will be afloat.

Therefore, if the Fed continues to follow instructions from the White House to pump the world economy full of dollars, the collapse of the American currency will become an inevitable event. At the same time, the scale of the current crisis will not allow the dollar to quickly regain its position. It is important to understand that it can collapse and rise from the ruins,” the source said.

When the coronavirus began to spread actively around the world, investors preferred the American dollar to currencies from the G10 countries: Great Britain, France, Germany, Italy, Japan, Belgium, the Netherlands, Sweden, Canada, the USA and Switzerland. The Deutsche Bank strategist also clarified that investors usually “flock to the US dollar” in times of uncertainty due to its relatively good position as a global reserve currency. But now the situation is noticeably changing and not in a favourable direction for the American currency, so the strategy and speed of the United States of America coming out of self-isolation look worse than in other countries.

“The packages of measures that the US has taken via the federal budget account for about 15% of GDP. In addition to this, the Federal Reserve is churning out large amounts of money. Obviously, these funds also go to the stock markets. [But, of course, no distinction is made here between stocks of badly managed companies – which should be allowed to fail – and well-managed ones. This indiscriminate distribution of unsecured loans to all major companies keeps bad companies afloat at the expense of the US economy as a whole]

Therefore, from the standpoint of simple exchange rates, it becomes quite obvious that the dollar’s ​​position in the world economic system will weaken in the near future, that is, for the summer-autumn period of 2020. In other words, the injection of funds from the Federal Reserve System is leading to a devaluation of the American currency, which can only have a weak foreign-economic value for the United States [ie, value in relation to foreign currencies],” the economist comments.

The saturation of the global economy with dollars leads to strong market volatility, which is becoming difficult to predict. This volatility, in turn, is easily capable of provoking a panic that could weaken the already fragile position of the American currency.

“The coronavirus pandemic is sending the world economy into uncharted waters, followed by a deep dip in the dollar. One of the important issues in this case will be the regulation of the international currency market, the impact of which the International Monetary Fund is experiencing today.

The weakening of the US currency as a factor in stabilizing the global monetary system can actually lead to other currencies playing its role,” the economist believes.

Reorientation of the post-crisis world

According to the leading macro strategist of Deutsche Bank, foreign exchange markets have recently been confronted with “multiple cross-currents” amid concerns about a second wave of coronavirus cases threatening the world. Investors looking to the American currency are asking a "big question" about whether they should buy the dollar at a premium for its alleged security against a backdrop of fears. Samir Goel suggested that if a second wave of coronavirus occurs, the United States dollar may weaken against most currencies in developed countries, including China.

As China gradually opens up its financial markets, while introducing more assets denominated in local currency,” the portfolio flow history is gradually becoming positive for the renminbi.”
“The yuan will continue to strengthen its position and will be seen by investors as a new international reserve currency. This will provide tremendous economic and political benefits to China. Moreover, in terms not only of its impact on the regional economy, but also of the international regulation of global financial flows. This is precisely what analysts in the United States of America fear.

The Chinese side is supporting its economy to a much lesser extent than the United States of America. This is due to the fact that the PRC economy is not experiencing so many major crisis shocks and is demonstrating certain growth rates,” said Vasiliev.

China foresaw such a scenario. As soon as the American side began to impose its conditions on Beijing for the upcoming trade deal, and after the partially concluded trade deal, while threatening sanctions and tariff increases, the Chinese government decided to pursue a wise policy regarding Washington’s actions, and in June 2020 Fan Xinghai, vice chairman of the Securities Control Committee of China, said China needs to prepare for a projected disconnect from the global dollar settlement system based on the interbank information transfer and payment system SWIFT and interbank electronic clearing settlement system CHIPS, in the event America imposes sanctions. [In other words, in the event the US tries to cut China off from these systems. Of course, the more the US weaponises the dollar and institutions dependent on it, the more foreign countries are pushed into distancing themselves from dollar-based transactions and thereby weakening the USD. US policy makers have lost all sense of the principle that every action is accompanied by an equal and opposite reaction]

By the way, strengthening the position of the Chinese yuan, Vladimir Vasiliev believes, will ultimately lead to a reorientation of many leading countries, including the Russian Federation. In April 2020, according to the data of the US Ministry of Finance, Russia increased its investments in US government securities by almost 80%, ie, to $ 6.85 billion – it had previously chosen to reduce these investments.

“In America, there is an obvious decline in GDP, and analysts cannot accurately predict the timing of the recovery of the United States economy. It is possible that it will begin no earlier than 2021. At this time, China will gradually come to maintain growth both in 2020 and in subsequent years.

It is at this time that a tectonic shift towards the renminbi would begin, which would determine a new direction for the development of the world economy. If this happens, then China will have an additional opportunity to accelerate the growth of its own economy and reorient many economic players. China has recently attracted the attention of the Russian Federation and has reduced the impact of the United States on itself in the framework of the trade war,” the expert said. [Economists acknowledge that it was China that restored the world economy after the 2008-9 Great Recession. There is no other economy that can stabilize the world economy after the pandemic crisis. And yet, US policy makers are intent on destroying it!]

Author: Alexandra Melnik

Vince Dhimos on Quora writing on this topic:
​
https://www.quora.com/Now-that-China-has-forced-America-to-its-knees-begging-for-mercy-when-should-China-strike-the-coup-de-grace-or-should-it-wait-until-Biden-gets-elected-before-deciding-what-to-do/answer/Vince-Dhimos

WAR NEWS

https://www.almasdarnews.com/article/gaddafis-cousin-warns-erdogan-we-are-able-to-reach-istanbul/?utm_medium=ppc&utm_source=push&utm_campaign=push%notificationss&utm_content=varies
 
Gaddafi’s cousin warns Erdogan: ‘We are able to reach Istanbul’
 
By News Desk -2020-06-260
 
BEIRUT, LEBANON (8:00 P.M.) – The political official of the Libyan National Struggle Front and cousin of the former Libyan President, Ahmed Gaddaf Al-Dam, said on Thursday that Egypt has the right to defend itself, pointing out that many of the bombings that took place inside the country came from Libya.
 
In an interview with Sky News Arabia, Qaddaf Al-Dam stressed that the efforts of Turkish President Recep Tayyip Erdogan to interfere in Libya will fail.”
 
“Egypt is subject to an organized war as an Arab country, and it has the right to defend itself when its red lines are crossed. As for us, our red lines are in Zuwara and Tobruk, and if the Turks extend to Libya, we are able to reach Istanbul, especially as we have allies in Turkey.”
 
Qaddaf Al-Dam considered that “Turkey was dragged into a trap in Libya,” saying: “Stupid policies that Erdogan signed, who thought he would be the caliph and that the Ottoman Empire would return through the gang that turned around Qatar, without realizing that they were carrying out a plan to destroy the Islamic world.”
 
He also considered that Ankara “is implementing a plan drawn up by the West,” saying: “The brothers in Turkey lost their minds and were lured to be drained financially, morally and militarily, and created internal problems there. I pity Turkey because Libya will return, as we have the will and strength, and we are a country that returns and recovers.”
 
“Our armed forces are returning and will join forces with each other in the east, west and south. They will not be able to resist our tribes, and there is no legitimacy in Libya except the legitimacy of the Libyan people.”
 
ALSO READ  Turkish-backed Libyan forces achieve major victory by retaking all of Tripoli
He added: “The West will not allow Turkey to exist militarily in the Mediterranean Sea, or to obtain Libya’s wealth, but Erdogan’s recklessness and encouragement of those around him made him believe that they would be victorious, but he might slip into this bump.”

​

 
Vince Dhimos answered a question at Quora.
 
https://www.quora.com/What-can-US-Republicans-really-do-to-stop-China-from-becoming-the-worlds-largest-economy/answer/Vince-Dhimos
 
WHAT CAN THE US REPUBLICANS REALLY DO TO STOP CHINA FROM BECOMING THE WORLD’S LARGEST ECONOMY?

Vince Dhimos
 
Editor-in-Chief at New Silk Strategies (2016–present)
 
Short of war, the US can’t stop China. A few examples will explain this.
 
After 2019, the first year of the trade war, the US still showed a very large, though somewhat diminished, trade deficit, but China had a surplus and an increase in trade of $1.34 trillion, thanks in large part to the members of its BRI. The trade war was designed to cripple China’s economy but it failed ignominiously. Almost all economists agree that trade wars are of no benefit and that both sides lose. So Trump was displaying abysmal ignorance of macroeconomics when he launched the war. It’s not that Trump is especially inept. ALL US presidents are ignorant of macroeconomics and their advisers are also focused only on a small area of that field that prevents them from seeing the whole-world picture. In particular, they all believe in quantitative easing (issuance of unbacked trillions) as a remedy to economic ills.
 
One problem for the US is that although it is China’s biggest trading partner, China has many others and the US’s share is only about 11% at this point. That is not enough to put a dent in China even if it were possible to shut off all bilateral trade.
 
The biggest problem, though, is the US’s overall strategy. The US economic strategy is zero-sum, while China’s is win-win.
 
Even in theory, or on their face, we can easily see which strategy is superior and which is designed to fail.
 
According to US zero-sum theory, if the competitor suffers economic loss, the other side gains. There is, of course, no logic in this. It is pure ideology. After all, it is possible that both sides could suffer loss. It is also possible that the side trying to cripple the other’s economy would fail (and that’s exactly what has happened).
 
In the Chinese win-win game, if China makes a poor African partner richer, for example, through judicious investments, then both partners gain because dealing with a rich partner is a bigger advantage than dealing with a poor partner since the rich partner can afford to import more of your goods. So Xi Jinping’s long-term goal of lifting Africa out of poverty is not just pure altruism, it is partly selfish, ie, win-win, as the Chinese leadership itself proudly admits.
 
Further, the US has, since the 2008–9 at Recession, been forced to turn to the Fed’s “printing press,” ie, the issuance of unbacked currency, to remedy crises, but this can only be a temporary remedy, as the Fed itself admits. In the long run, it creates a real risk of making the world lose confidence in the US dollar. Already, Morgan Stanly’s ex chief economist Stephen Roach has predicted a crash in the dollar in 2021 (A Crash in the Dollar Is Coming).
 
China, of course, does not have this problem. In contrast to the US, it has over a trillion dollars in US Treasuries saved up for such a crisis as the COVID pandemic. Of course, Western critics like to jeer that China’s companies often file for bankruptcy. But look, that is not a sign of a badly run economy, to the contrary, it shows that badly run companies are flushed from the system as they well should be. Contrast this with the US non-solution: after the Great Recession, and now again following the onset of the COVID crisis, the Fed printed up trillions of unbacked dollars and spread them all over the map, helping bail out companies with abominable management that should have been allowed to fail — and would have in the good old days of fair competition. But for the Fed, their billionaire cronies in Big Business are royalty and cannot be allowed to fail. Thus, these badly managed companies become a permanent drag on the overall economy and their owners are rewarded for their incompetence. Now ask yourself: is a country that consistently rewards incompetence destined to win or doomed to fail? This horribly flawed system, BTW, is why the income gap between rich and poor is growing to such staggeringly heights. And there is no cure for it because nothing can stop the Fed from continuing to reward its filthy rich pals (this is one reason why we can’t talk about American “democracy,” which is a chimera. It’s all explained here). This is what we call corruption, and the favouring of the rich goes hand in hand with the favouring of whites by police (though few have noticed it). It’s part of the same social and spiritual cesspool that drags down America and festers until it erupts in a coast-to-coast conflagration that the Federal government is powerless to contain.
 
But getting back to China, the US had slandered Huawei in hopes of ruining that company, but that was very foolish because Silicon Valley tech workers have known for some time that there are delicate ties between US tech and Chinese tech that make it impossible to decouple the two sides. And just to show how this attempted sabotage worked out, the US was recently forced to back down and allow Huawei to cooperate in the US 5G rollout.
 
Nothing, absolutely nothing, is going America’s way in this foolish zero-sum game, and unless the US wakes up and sees the whole picture of US-China ties and their indispensability for the US economy, the zero-sum nonsense will continue to blow up in the US’s face.
 
I have posted answers to various questions at Quora that provide further details:
 
https://www.quora.com/Is-Russia-benefiting-from-driving-a-wedge-between-China-and-the-US-e-g-Russia-has-more-projects-in-Chinas-BRI-initiative-than-any-other-nation/answer/Vince-Dhimos
 
https://www.quora.com/What-do-Americans-typically-get-wrong-about-the-economy-of-China/answer/Vince-Dhimos
 
https://www.quora.com/Would-China-dethrone-the-US-and-become-a-global-superpower-in-the-post-Covid-world/answer/Vince-Dhimos

 
WAR AND CRISIS NEWS
 
In the following you will find our translation of an article in nation-news.ru with commentary and notes [in brackets] by Vince Dhimos.
 
https://nation-news.ru/531605-rossiiskii-diplomat-obyasnil-zverstva-pns-livii-v-tarhune-problemami-s-psihikoi?utm_source=whitepush.biz&utm_medium=push&utm_campaign=push14_17_06_2020
 
Democrat-backed Libyan Government of National Accord shows its true colours again. This time, its psychopathic militias harass and rape civilians.
 
17 June 2020
 
Various news reports from the US and elsewhere show that the Libyan GNA is not the kind of “government” the US should be supporting. A GNA official admitted to the WaPo that it is supported militarily by ISIS and Al-Qaeda militants imported to Libya by Turkey. So far, the Trump administration has shown restraint, not supporting either side in the war, but the Democrats are intent on making political hay out of the fact that the Russians are fighting on the anti-terrorist side, claiming that both Russia and the Haftar troops it supports should be sanctioned under the Countering America’s Adversaries Through Sanctions Act (CAATSA) simply because Russia is involved. So when Russia opposes terror that is bad just because Russia is, by the perverted definition of US lawmakers, an “adversary” of the US, based on the lie that Russia is an “aggressor” (I debunked this notion here). It is becoming increasingly clear that the US Democrats, the same party that killed Ghaddafi and plunged Libya into civil war, are behind this move to punish Russia for protecting civilians in that country. As if they haven’t done enough damage there!
 
https://nation-news.ru/531605-rossiiskii-diplomat-obyasnil-zverstva-pns-livii-v-tarhune-problemami-s-psihikoi
 
Russian diplomat attributes the atrocities of the Libyan Government of National Accord (GNA) in Tarhun to mental problems
 
June 17, 2020
 
https://nation-news.ru/531605-rossiiskii-diplomat-obyasnil-zverstva-pns-livii-v-tarhune-problemami-s-psihikoi
 
The militants of the so-called Government of National Accord (GNA) of Libya suffer from mental illness and have derangement, said Stanislav Kudryashov, spokesman for the Eastern Libyan Government in the Russian Federation.
 
According to Kudryashov, it is precisely the problems with the psyche that are indicated by the video recordings on which the Misurat group raped a person who looked like one of the Egyptian workers. After this incident, videos appeared with the torture of other abductees in Tarhun. According to the expert, in reality, the GNA is fighting not for the Libyan people, but for atrocities and violence.
 
"They have already formed serious mental derangement, which the militants of Sarraj and Bashagi themselves most certainly possess. All this is sad and abnormal," the Federal News Agency (FAN) quotes Kudryashov as saying.
 
According to the expert, children are growing up in this kind of environment, and several million people are forced to live under the control of mentally ill representatives of the GNA. Kudryashov believes that the actions of jihadists are not compatible with the logic of a healthy person, and that militants can only be stopped by implementing common efforts [unfortunately, such efforts are opposed by the Turks and US Democrats]. The expert believes the world community can stop the chaos created by the GNA in Libya. Kudryashov called the actions of the militants inexplicable, since this is a surge of aggression against defenceless people who are not waging war with them.
 
Earlier, the Libyan GNA released false news about the presence of PMC "Wagner" [Russian mercenaries] in the country. No one could confirm this information. [The GNA knew that sleazy American lawmakers would use this unconfirmed report to garner support for their side, but when all they have in their “favour” is the fact that the Russians oppose them, that shows that they have no logical arguments to support them. After all, the Russians sent medical aid to the US. Does that mean this medical aid was bad or unhealthy. It is sad that so many Americans fall for such flimsy propaganda]
 
Author: Oleg Nikitin

Below you will find our translation of an op-ed by Ivan Danilov from RIA Novosti with a foreword and notes [in brackets] by Vince Dhimos. As usual, Danilov takes his facts from the US financial press, but this time the American commentators have pulled out the stops and their straightforwardness and honesty echo that of the Russian commentator. It is no longer possible for Western financial journalists to hide the glaring facts about the precarious state of the US economy and the dollar.
 
Another wave of the pandemic is expected in the fall and that wave could be followed by another. Each wave will be accompanied by the issuance of more trillions in unbacked dollars. It’s the only trick the Fed knows at this point. There is no other way for a nation that has forgotten the value of saving. Say what you want about Russia and China, but they both know the importance of saving for a rainy day. 
 
It’s the greatest loss America has ever suffered, but yet, it could be the most valuable lesson it has ever had.

Now, of course, America has received many valuable lessons, but like a lazy student who spends his time in class staring out the window and daydreaming, it has not yet learned any of them. Incredibly, it keeps making the same mistakes over and over again, supporting the same kind of warlike and irresponsible leaders as before. But if this time America learns that love and compassion for its neighbours is the only way to greatness – not trade wars, not blaming others, not sanctions, not wars, not quantitative easing, not self-aggrandisement, will it not have been worth it? God forbid that this pandemic cum rioting cum economic catastrophe will be another of the many lessons received but not learned?
 
If I have the gift of prophecy and can fathom all mysteries and all knowledge, and if I have a faith that can move mountains, but do not have love, I am nothing. 1 Corinthians 13:2
 
BEGIN TRANSLATION
 
American top economist: "A crash in the dollar is coming in 2021"
 
June 12, 2020
 
Ivan Danilov
 
The “coronavirus crisis” and riots, which have already led to billions of dollars in material damage, as well as damage to image that cannot be measured in money at all, are forcing the American expert community to look at the United States with different eyes. Not through the eyes of a delighted teenager, a professional propagandist or a naive viewer of an old Hollywood action movie who knows in advance that in the end America will defeat everyone and evil (that is, those who oppose Washington) will be severely punished, but through the eyes of a doctor watching the onset of a serious illness.

Among those who dare to look at the United States in this way, there is a certain pluralism of opinions. In the sense that some believe that all problems can be solved by disbanding police departments (by sharply cutting their budgets), after which racial peace and economic grace will arrive in the United States. But it seems to some that the United States needs to concentrate on its new cold war with China, probably implying that identifying a common and very serious enemy will become a kind of "sociocultural glue" with which the shattered American society can be re-assembled.
 
Both of these estimates, most likely, are very far from the truth, and their supporters can (and even should) be suspected of a certain bias, but it is more interesting to analyse the opinion of an elite that does not so much offer a "cure" but points out the possible exacerbation of all America's problems because not only American democracy and the image of the world hegemon, but the very foundation of American welfare, the US dollar, is also threatened.
 
It is noteworthy that the author of this forecast (or rather an apocalyptic financial prophecy) is not an ordinary expert or analyst, not a marginal journalist, but a representative of a completely different class, the “ideal American elite” in the person of Stephen Roach, who wrote a column for Bloomberg, published under the emotional headline, unusual for an American financial agency, "A crash in the dollar is coming."
 
Stephen Roach is a PhD in economics, a former member of the board of directors of the US Federal Reserve, a senior fellow at the influential analytical centre Brookings Institution, a former Asian leader and former chief economist at leading US bank Morgan Stanley, and now a senior fellow Research Associate at Jackson Institute of Global Affairs at Yale University, the most influential Ivy League university.
 
His column is noteworthy in that it immediately discards at least some attempts to give the current version of the world financial system at least some illusion of justice, validity or honesty. No, Dr. Roach calls things by their proper names – with the bluntness that many Chinese or Russian journalists will envy:
 
“The era of the U.S. dollar’s “exorbitant privilege” as the world’s primary reserve currency is coming to an end. Then French Finance Minister Valery Giscard d’Estaing coined that phrase in the 1960s largely out of frustration, bemoaning a U.S. that drew freely on the rest of the world to support its over-extended standard of living. For almost 60 years, the world complained but did nothing about it. Those days are over.”
 
When regular attempts to de-dollarize Russian exports or European imports, and in general any part of the global financial system, come across in the information field the caustic sarcasm of “experts” explaining that the dollar cannot and should not be replaced, then you should remember this beautiful description of the problem: even a leading American expert recognizes that dollar status is a privilege that gives the United States unfair preferences, and that the standard of living in the United States is not supported by any magical achievements of the authorities, but by the use of these privileges against the rest of the world.
 
Despite the fact that all dollar problems worsened during the era of the coronavirus, the Yale economist indicates that the problems are systemic and structural in nature:
 
“Lacking in domestic saving, and wanting to invest and grow, the U.S. has taken great advantage of the dollar’s role as the world’s primary reserve currency and drawn heavily on surplus savings from abroad to square the circle. But not without a price. In order to attract foreign capital, the U.S. has run a deficit in its current account — which is the broadest measure of trade because it includes investment — every year since 1982.”
 
Covid-19, and the economic crisis it has triggered, is stretching this tension between saving and the current-account to the breaking point.  The culprit: exploding government budget deficits.”
 
According to him, when the initial global shock passes and the world realizes the state of the American economy, in 2021 the dollar will depreciate to 35% against a basket of currencies of countries in which the United States conduct international trade, and, apparently, this is far from the limit of a possible devaluation. Protectionism by the Donald Trump administration and the deterioration of the US international image (and Dr. Roach recalls that “international leadership” is an element supporting the dollar’s ​​status) will make the situation worse, ing the main problem unresolved: Americans really want to spend a lot (and the list of those wishing to spend a lot of money includes primarily the US government), but they have forgotten how to save money and basically do not want to re-learn how to do it. [Actually, it is not a matter of not wanting to learn. The US government is locked into the spending habit by politics. Lobbies, including the arms makers and the Israel lobby, in tandem with a culture of paranoia toward Russia and China (perpetually accused of “aggression”) among the grassroots, and Evangelicals adhering to the cult of Zionism, leave no alternative to government overspending.]
 
The warning from the former chief economist of Morgan Stanley, is particularly striking against the backdrop of news that the US Federal Reserve does not see a quick economic recovery after the coronavirus, and also expects dollar interest rates to be around zero for about two years.
 
The recent promise of Treasury Secretary Stephen Mnuchin to again turn to the US Congress for permission to increase debt even more (in fact, to print money and pour it into the budget) only strengthens the arguments of "dollar pessimists." But one must admit the obvious: the United States still has one, typically American, method of protecting its privileges. All they need to do is make sure that all other countries are even worse off than the USA itself, and then the American financial system and the dollar will look quite promising. The problem is that the world has changed dramatically since the 1960s. And now the United States is unlikely to have enough opportunities to carry out an operation of this kind with impunity, although Washington will definitely try using sanctions and provocations, including against Russia, China and the European Union. [Congress is already escalating sanctions related to the Russian pipeline project Nord Stream 2 and Germany is furious]
 
END TRANSLATION
 
WAR NEWS
 
Iran was prepared to attack US ships if oil tankers were intercepted en route to Venezuela: report
 
By News Desk
 
2020-06-13
 
BEIRUT, LEBANON (9:40 P.M.) – On Saturday, a news agency close to the Iranian Revolutionary Guards said that Iran had prepared to target American merchant ships in the Gulf in the event that the U.S. Navy intercepted Iranian tankers that were en route to Venezuela.
On its website, the Noor News reported that Iran sent a fleet of five fuel tankers to its ally Venezuela, which desperately needed gasoline in May, and Tehran said it would continue these shipments if Caracas requested more, despite Washington’s criticism of trade between the two countries.
Both of these nations are currently under strict sanctions by the U.S. and its allies, which makes it difficult for them to trade with other nations internationally.
“After increasing military threats against Iranian ships heading to Venezuela, an order was issued to the Iranian armed forces to identify and track several American commercial ships in the Persian Gulf and the Gulf of Oman,” the agency said.
Iran complained to the United Nations, last month, and summoned the Swiss ambassador to Tehran, who represents U.S. interests in Iran, about possible measures Washington might take against Iranian tankers.
A U.S. official had previously told Reuters last month that the United States, which had not blocked Iranian tanker shipments, was considering imposing sanctions on dozens of additional foreign oil tankers for its dealings with Venezuela.
 
Relevant:
 
http://www.newsilkstrategies.com/culture/the-parable-of-the-good-samaritan-the-part-they-didnt-teach-you-in-sunday-school