Thursday, May 22, 2014

Who Needs The U.S.? Not Russia And China

Below we see a sobering assessment as relating to the China-Russia alliance and what is to come:

Russia and China have just signed what is being called "the gas deal of the century", and the two countries are discussing moving away from the U.S. dollar and using their own currencies to trade with one another. This has huge implications for the future of the U.S. economy, but the mainstream media in the United States is being strangely quiet about all of this. For example, I searched CNN's website to see if I could find something about this gas deal between Russia and China and I did not find anything. But I did find links to "top stories" entitled "Celebs who went faux red" and "Adorable kid tugs on Obama's ear". Is it any wonder why the mainstream media is dying? If a particular story does not fit their agenda, they will simply ignore it. But the truth is that this new agreement between Russia and China is huge. It could end up fundamentally changing the global financial system, and not in a way that would be beneficial for the United States.

Russia and China had been negotiating this natural gas deal for ten years, and now it is finally done. Russia is the largest exporter of natural gas on the entire planet, and China is poised to become the world's largest economy in just a few years. This new $400 billion agreement means that these two superpowers could potentially enjoy a mutually beneficial relationship for the next 30 years...

Russia reached a $400 billion deal to supply natural gas to China through a new pipeline over 30 years, a milestone in relations between the world’s largest energy producer and the biggest consumer.
President Vladimir Putin is turning to China to bolster Russia’s economy as relations sour with the U.S. and European Union because of the crisis in Ukraine. Today’s accord, signed after more than a decade of talks, will allow state-run gas producer OAO Gazprom (GAZP) to invest $55 billion developing giant gas fields in eastern Siberia and building the pipeline, Putin said.
It’s an “epochal event,” Putin said in Shanghai after the contract was signed. Both countries are satisfied with the price, he said.

Of course countries sell oil and natural gas to each other all the time. But what makes this deal such a potential problem for the U.S. is the fact that Russia and China are working on cutting the U.S. dollar out of the entire equation. Just check out the following excerpt from a recent article in a Russian news source...

Russia and China are planning to increase the volume of direct payments in mutual trade in their national currencies, according to a joint statement on a new stage of comprehensive partnership and strategic cooperation signed during high-level talks in Shanghai on Tuesday.
“The sides intend to take new steps to increase the level and expansion of spheres of Russian-Chinese practical cooperation, in particular to establish close cooperation in the financial sphere, including an increase in direct payments in the Russian and Chinese national currencies in trade, investments and loan services,” the statement said.

In my recent article entitled "De-Dollarization: Russia Is On The Verge Of Dealing A Massive Blow To The Petrodollar", I warned about what could happen if the petrodollar monopoly ends. In the United States, our current standard of living is extremely dependent on the rest of the world continuing to use our currency to trade with one another. If Russia starts selling natural gas to China without the U.S. dollar being involved, that would be a monumental blow to the petrodollar. And if other nations started following the lead of Russia and China, that could result in an avalanche from which the petrodollar may never recover.

And it isn't just the national governments of Russia and China that are discussing moving away from the U.S. dollar. For example, the second largest bank in Russia just signed a deal with the Bank of China "to pay each other in domestic currencies"...
You can almost feel the power of the U.S. dollar fading.
A few months ago, when I wrote about how China had announced that it no longer planned to stockpile more U.S. dollars, I speculated that it may be evidence that China planned to start making a big move away from the U.S. dollar.
Well, now China's intentions have become even more clear.
The Chinese do not plan to allow the United States to indefinitely dominate the globe financially. In the long run, the Chinese plan to be the ones calling the shots, and that means that the power of the U.S. dollar must decline.
These days, instead of piling up mountains of U.S. currency, China has started accumulating hard assets instead. In the past, I have written about how China is rapidly stockpiling gold, and it turns out that the Chinese have also been very busystockpiling oil as well...

Once upon a time, China was extremely dependent on the United States economically. The same was true with most of the rest of the world.

But now economic power has shifted so dramatically that nations such as Russia and China are realizing that they don't really need to be dependent on the United States any longer.
And with each passing year, the relationship between Russia and China is becoming stronger. As Pepe Escobar recently observed, this emerging alliance is causing quite a bit of consternation in Washington...
Right now, the number one U.S. export is U.S. dollars. Our massively inflated standard of living is very heavily dependent on the rest of the world using our currency to trade with one another and lending it to us at super low interest rates.
If the rest of the world quits playing our game, our debt-based financial system will quickly fall apart.
Unfortunately, nobody in the Obama administration seems to have much understanding of global economics, and they will probably continue to antagonize Russia and China.
In the end, the consequences for antagonizing them could end up being far greater than any of us ever imagined.

China and Russia have agreed a massive gas delivery deal scheduled to last for three decades - and valued at up to $400bn (£235bn).
The agreement, 10 years in the making, was signed after last-minute negotiations during a visit by Russian President Vladimir Putin to Shanghai.
Chinese President Xi Jinping and Mr Putin witnessed the signing, according to a statement by China's state energy giant CNPC.
"This is another major milestone achievement in China-Russia energy strategic cooperation," it said, adding it was "facilitated and greatly supported personally by the leaders of China and Russia".
Moscow media cited Alexei Miller, the chief of Russia's energy giant Gazprom, as saying the gas deal was worth $400bn over its 30-year contract life.

Under cover of conjoined military exercises with Israel (Juniper Cobra) and Jordan (Eager Lion), the US has moved more than 6,000 Marines to Jordan and several thousand servicemen to Israel. The Jordanian drill starts Sunday, May 25 and will last until June 8. The US-Israeli exercise began this week with the participation of another 6,000 combat personnel from the US European Command and 1,000 airmen to operate missile defense systems.
Sailing opposite Israel’s Mediterranean shore are two US warships carrying Aegis Combat Systems. Due to arrive in the Jordanian Red Sea port of Aqaba over the coming weekend are large US landing craft, that will drop marines on land. Gulf units are also taking part in the combined exercise.
This is the first time that the US has unified two large military exercises. The Jordanian and Israeli drills will be coordinated by US command centers.
The two war games were planned as military maneuvers plain an simple until Wednesday, May 21, when news came in of large Hizballah military forces heading toward southern Syria to help the Syrian army overcome the rebel forces fighting for more than a week to capture the Syrian Golan town of Quneitra opposite the Israeli and Jordanian borders.
In the last few days, both Israel and Jordan have beefed up their Syrian border deployments and placed them in battle stations. Hizballah’s intervention in the Golan battle may well result in the war game being switched to combat operations for real. debkafile’s first report on the escalating Golan situation appeared on May 20.

[AKA - 'wars and rumors of war']

‘I have the feeling that after the second Thirty Years’ War, for that is what it is, through which we have just passed, mankind needs and seeks a period of rest.” So said Winston Churchill in 1948, speaking of the carnage-filled years from 1914 to 1945 during which the world was at constant war.
This Memorial Day, May 26, at 9 p.m. ET, HISTORY premieres its new, groundbreaking three-part series – World Wars — covering this period and the men who shaped it.
Narrated by Oscar® nominee Jeremy Renner (The Hurt LockerThe Town), World Wars tells the story of three devastating decades of war through the eyes of the powerful men who held the fate of humankind in their hands — men like Roosevelt, Hitler, Patton, Mussolini, Churchill, Tojo, de Gaulle and MacArthur. The series examines the two wars as one continuous timeline from 1914 to 1945 with these unique individuals coming of age on the battlefield before ultimately making some of the toughest decisions in the history of mankind.

Diplomats, media and peace activists apparently eager to paint Israel as the main obstacle to peace have been quick to publish and point to numerous reports that Hamas is being encouraged and has even agreed to recognize Israel as part of its unity agreement with the Palestinian Authority.
It would seem that those reports were either premature or purposely embellished, and that those who latched on to them should have first done some rudimentary fact-checking.
In just about every case, the subject of those reports - from the Palestinian Authority to Egypt to Hamas itself - has subsequently denied making any conciliatory gesture or remark toward Israel.

Soon after the PA-Hamas deal was announced, The Washington Post and others tried to blunt Jerusalem’s sharp criticism by quoting Palestinians officials who said the agreement would include recognition of Israel.
Hamas spokesman Taher Nunu was quoted by the Post as agreeing with Palestinian leader Mahmoud Abbas’ purported statement that his group must accept Israel’s right to exist. 

Now, Nunu is threatening to sue the newspaper for misrepresenting himself and Hamas.
“What I was quoted as telling the American paper is wrong, and I unequivocally deny it,” Nunu told Palestinian media. “The issue of Hamas recognizing Israel is a complete nonstarter.”
Abbas’ own spokesmen later contradicted the Palestinian leader’s own statements on the matter. In an interview with the London-based daily Al-Hayat, one senior PA official insisted Abbas had never required Hamas to recognize Israel as part of the Palestinian unity pact.

As evidence that no one in the Arab world is really pressing Hamas to recognize Israel, the group has actually been moving in the opposition direction, validating the very reason Israel sees the Palestinian unity deal as yet another insurmountable obstacle to peace.
“With the invader we will not make any compromises,” Hamas leader Khaled Mashaal said on Tuesday during an event in Doha. “The reconciliation does not mean an end to our resistance against the invaders, resistance will continue as long as the occupation exists.”
Hamas refers to Israel as a foreign “invader,” uses “resistance” as a euphemism for what most define as terrorism, and insists that the “occupation” encompasses the entirety of the Land of Israel.

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