Tuesday, January 6, 2015

The U.S. vs BRICS: And The World Was Split Into Twain, Hollande: Russian Sanctions 'Must Be Lifted Now'

In 1991, the Cold War between the US and the USSR ended, as, economically, the USSR had run its course. Since that time, the US has had the ability to back off on armaments and to strengthen itself economically, to become even more powerful as the world’s present empire.
But, of course, that’s not what they did. Instead, they went headlong in the direction of becoming a more highly armed, more fascist state. Along the way, they became extremely reckless with their economy, following a Keynesian model that contributed to the greatest debt bubble the world has ever seen.

During this period, they had numerous knowledgeable advisors who recommended a Westphalian system of cooperation between nations. But the leaders of the empire chose instead to pursue greater, more forceful dominance of the world. Over recent decades, US leaders have become increasingly self-possessed with their assumed level of power. So much so that, as long as they can sell the idea to the American people that the larger world is a threat to the US, they can advance as they please against other nations.
Nowhere in their thinking were they more incorrect than in their assumption that they could arrange for a takeover in Ukraine, a country long regarded as a key objective by the West in lessening Russian power.

But in the decades since 1991, Russia has rebuilt itself and has become powerful once again. In addition, its present leader has shown himself to be able to consistently outwit US leaders. This was either not anticipated or was regarded as unimportant.
Not only have American attempts at diminishing Russian influence resulted in Russia deftly countering every US move, they have resulted in Russia’s leader gaining great popular support, just as the US president loses his. Further, it has driven the Russians toward the other BRICS, convincing them to become closer with regard to treaties, trade, and economic development.

Along the way, the less powerful countries in the world, seeing the rise of the BRICS and realising that they might need to choose between the two, are choosing the BRICS. The Russians and Chinese have been busy in recent years, signing treaties and agreements first with Second- and Third-World countries and now with Western allies in Southeast Asia and Europe.

But, incredibly, the US has trashed its own economy, driven productivity away (via the world’s highest corporate taxation), and created a level of debt that is far too large to ever repay. To add to this, they have invaded country after country.
What on Earth made them think that the BRICS would take this lying down?

By comparison to the US, the BRICS, in recent years, have done a sterling job of becoming increasingly productive, establishing treaties and trade agreements, and working toward a common understanding that the US and the EU are a danger to them.

  • China will take over as the world’s most productive country.
  • China Merchants Bank now issues the world’s #2 credit card.
  • In response to US/EU sanctions, Russia and China have recently inked the largest energy-provision agreement the world has ever seen, posing a major threat to the continued position of the petrodollar.
  • By mid-2015, the Angola-Brazil fibre-optic cable will enter service, providing cheaper (by 80%) communications for the BRICS, independent of the US.
  • Increasingly, the world is entering into agreements to trade in the yuan and the ruble. Some EU countries now issue bonds in yuan.

I’ve often stated that, with each year, both the magnitude and the frequency of events will increase. That theory seems to be holding true. Only a year or so ago, the question of whether the BRICS might even form their own IMF might have seemed quite fanciful. Today, we should be looking more closely at this possibility.
With this final step, the world could literally function as two separate worlds. Communication, trade, and inter-governmental economic dealings will undoubtedly continue, but at this historic point, the BRICS will have theability to operate entirely independently and can no longer be held to ransom through the threats of sanctions from the West.
The world is now changing rapidly, and our future plans should be based not on what exists at present, but on what is likely to exist in the future.

Most U.S. citizens have been spoiled by the profits made from stock and real estate investments since 1990, and they see the 2008 crash as just a bump in the road. They are not aware that the hot economy was a bubble caused by excessive creation of new money (monetary inflation), and that a bigger crash is coming.

1) Our massive (unpayable) government debt of $18 trn (admitted) and another about $130 trn (hidden) of unfunded liabilities for Medicare, pensions, etc.,
2) The falling use of the USD as the world’s primary reserve currency (was 80% of international transactions, now about 60%). Note that as the issuer of the world’s primary reserve currency, we are the only nation that can create new money (via the Fed) to pay our bills! We have abused this (what French President Charles De Gaulle called our ‘exorbitant privilege’) by creating trillions of new dollars (monetary inflation), which will cause hyper price inflation (over 20% loss of value monthly) if we don’t stop!
3) The inflation and jobless numbers are distorted by the government to keep them low,
4) The BRICS (Brazil, Russia, India, China, and S. Africa, plus more joining) are angry at U.S. imperial bully tactics and are avoiding the USD by dealing in their own currencies. To reduce dependency on the U.S. (and our bully tactics), they are creating a central bank, an IMF-style lender, and a funds processing (checks, deposits, etc.) network. The so-called ‘Petrodollar’ (Saudis have agreed to sell oil only for USD since 1974) is getting weaker as various producers sell in a variety of currencies and gold. Not selling oil for USD is a death sentence, and was a big part of why we invaded Iraq and Libya, and are poking Iran, and
5) Our conversion to a consumer economy due to a massive amount of imports, funded by excessive amounts of new money (which only the issuer of the world’s primary reserve currency can do), that results in ‘offshoring’ of jobs, factories, and technology.

The truth is that the U.S. economic and social systems (subsidies, entitlements, etc.) are heading for another crash, and bigger than the one we had in 2008. We have all the characteristics of a failing empire; falling domestic production, big and increasing debt (government and personal), desperate politicians seeking more money and control (search for ‘FATCA’), restricting rights of citizens, and endless wars to gain and retain powers. For details, see my essays, “The Phases of an Empire” and, “The Cost of Building and Operating Empire (USA).”

French President Francois Hollande is wary of the impact economic crisis in Russia might have on Europe. He has called for sanctions imposed against Moscow to be lifted as soon as there’s progress in peace talks over Ukraine.
If Russia has a crisis, it is not necessarily good for Europe,” Hollande said during a two-hour interview with radio station France Inter. “I'm not for the policy of attaining goals by making things worse, I think that sanctions must stop now.” 

Hollande said he wanted to make sure there’s progress in peace talks over the situation in Ukraine, before putting an end to sanctions.

He said he hopes to see signs of mutual understanding at the January 15 talks in Astana, Kazakhstan. The meeting is being organized by Ukrainian President Petro Poroshenko, and Russian President Vladimir Putin and German Chancellor Angela Merkel are expected to be among the participants. 

Moscow has repeatedly said it was doing all in its power to facilitate the peace process in eastern Ukraine. A major breakthrough was achieved during September’s Minsk peace talks, brokered by Russia.

Russia’s Foreign Minister Sergey Lavrov has sarcastically described western sanctions, also announced in September, as “a ‘reward’ for Russia’s role in the Minsk agreements and more generally for its part in organizing the meeting.”

Another round of peace talks in Minsk took place in December. The negotiations, which brought no breakthrough in the crisis, were overshadowed by Ukrainian parliament voting to revoke the country’s “nonaligned” status, paving its way for closer ties with NATO and eventual full membership. 
Hollande said he understands that Kiev’s striving for NATO membership can hardly contribute to the peace process.

Mr. Putin does not want to annex eastern Ukraine. I am sure. He told me so,” Hollande told France Inter. “What he wants is to remain influential. What Mr. Putin wants is that Ukraine does not become a member of NATO. The idea of Mr Putin is not to have an army at Russia’s borders.” 

In the latest issue of the terror group’s Inspire electronic magazine, an individual called the AQ Chef was quoted as saying they developed a bomb in 2009, but “the brothers in the external operation committee did not give us the green light until recently.”
Hinting at al-Qaida in the Arabian Peninsula’s dedication to building undetectable bombs, he said in the winter 2014 edition of Inspire, released in late December, “they have developed other bombs that are more effective.”
AQ Chef indicates that lessons learned from failures in past assassination attempts and plots to attack U.S. airplanes and buildings have fed the development of a new generation of what it calls “undetectable” bombs.

In “The Hidden Bomb,” a 20-page section of the magazine, the writer goes into painstaking detail about how to build and test such a bomb: “For several months, we conducted a number of experiments. As a result we came up with these simple materials that are readily available around the globe, even inside America. We spared no effort in simplifying the idea in such we made it ‘another meal prepared in the kitchen’ so that every determined Muslim can prepare.”
The magazine’s editor, Yahya Ibrahim, in a different section of the magazine, also claimed the organization’s bomb-makers have been working on a recipe that is “something unique that can easily be prepared at home.”
Reflecting the group’s urgent desire to disseminate the recipe, Ibrahim apologized to their supporters for taking nine months to produce the 13th edition — indicating that the work on the new bomb was the hold-up.

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