On the surface, for those who see the world in terms of sovereign nation-states competing for dominance and limited resources, the emergence of the Petro-Yuan appears to be a threat to what has been the dominant currency on the planet at least as far back as the early 50's, when the repercussions of the Bretton Woods agreement (1944) among the "Allies" took full effect, as "Federal" Reserve Notes (FRNs) became the de facto world reserve currency.
The reality, however, is that most of the world is comprised of governments that have become public sector subsidiaries of the Anglo-Euro-American banking cartel and its corporations; for example, the US, UK, France, Saudi Arabia, and Israel. This is why those who control the key levers in the independent federal state, the District of Columbia, freely transfer money and weapons, from the Fed and Pentagon, to Saudi Arabia and Israel, because they use these state apparatuses as proxies ("airstrips," as Orwell would call them) for their objectives.
Those who do not see the overriding corporate structure may complain about these transfers, as if the government of the US represents them, which it obviously does not. It has no loyalty to those who think of themselves as US citizens. The voting mechanism is completely hacked and painted over by the corporate mass and social media. Representatives don’t care about their constituencies (and often avoid them) because they are selected by the cartel, and not elected, except as a sham.
Above this façade of sovereignty is the cartel, at the top of which are a small number of beings who, above all, control money creation, which they have leveraged into control over corporations, natural resources, governments (including military and intelligence services), and the masses.
These lords of finance use money in different ways than the people are generally able to conceive. To understand this, one must begin by understanding the difference between money and capital, the effects of interest, and alternative ways in which money can serve a sovereign people. (For the details on this, see our posts here and here.)
It is true that a group of nations (Russia, China, Iran, Venezuela, etc.) have been trying to develop an alternate value exchange to the Fed, the Exchange Stabilization Fund (ESF), World Bank, and IMF axis-of-evil, but the cartel has lots of weapons to subvert any attempts at independence from its web of debt.
Russia and China are implementing their own SWIFT system, to rapidly exchange value using rubles and yuans, which are the only currencies they use to trade between themselves. Russia is energy rich and China, as the industrial slave state for transnational capitalist corporate giants, is energy hungry. China buys oil from Russia, as well as from Venezuela, for example. Venezuela recently announced that it would be valuing its oil in yuans, which adds fuel to the fire of the long history of attempted coups d’etat in Venezuela by the CIA. It also appears that the recent house-cleaning by the King of Saudi Arabia means that they will be selling greater amounts of oil to China.
So, yes, this is the beginning of the Petro-Yuan.
However, like Russian nesting dolls, there are many additional layers to the matrix, on some of which we can only speculate.
Let us step back a moment and consider what it would be like if you were one of the handful who have control over trillions, if not quadrillions, of FRNs. As the practice of political economy teaches us, there are many ways in which value (represented in currency, precious metals, and/or oil) can be transferred and manipulated to the advantage of those whose hands are on the levers of the Fed, the Pentagon, the Bank of England, the European Central Bank, and the public-sector subsidiaries attached to these money creation scams.
For example, one technique by which the cartel steals resources is to transfer value into gold or currencies with strong exchange rates, and then speculate and attack a target nation’s currency, driving its value into the ground. When the currency bottoms out, and many collateralized assets, both corporate and personal, have been defaulted, then the cartel can exchange its gold or strong currencies for the devalued currency of the targeted nation and literally buy up the natural resources and assets of that nation for fire-sale prices.
So, what if you were a financier and you knew that FRNs were, in the near future, going to lose value based on 70 years of printing to provide a common denominator medium of exchange for the entire planet?
What would you do? You would convert massive portions of FRNs and gold into yuans. Considering that the cartel has significant stakes in Chinese state-owned banks and securities firms (here and here), this would be an easy task.
After such massive transfers, if the FRN collapsed (or became a lesser player, which is occurring now, as the yuan begins to play a larger role in selective drawing rights [SDRs]), many once-valuable assets (in places where FRNs still rule) would be cheaply acquired as a result of bankruptcies, foreclosures, joblessness, and such.
We are not saying that this is the strategy, but we are saying that such a strategy is possible and that the financiers are most certainly aware of the potential of such a strategy.
This is only one tack of many available to the cartel. Right now, FRNs are still dominant, both in terms of the percentage of selective drawing rights (58%) and in terms of trade (80%). But as the original Zero Hedge article says (first link at top of this article), and as we reiterate here, this is the beginning of a shift.
Where we disagree with the Zero Hedge article and other Chicken Little alarmists, is that this shift to the Petro-Yuan is necessarily a threat to the cartel. Yes, this seems to be a threat to "Federal" Reserve dominance, which has been the cartel's chief printing press for value, but there are endless scenarios. The cartel could also use FRN to yuan conversion to subvert the yuan. Or the cartel could create a situation where the US (still the world's largest economy) demand for Chinese goods is reduced, thus sending the Chinese economy into a tailspin. With a bottomless store of FRNs, the possibilities are endless; for example, crashing the Chinese stock market.
(In fact, the Saudi decision to sell more oil to China, announced three weeks after this article was originally posted, is a perfect example of the cartel moving FRNs into yuans, by having the Saudis shift from the petro-dollar to the petro-yuan. This way, the Saudis can move FRNs into yuans by using their FRNs, which formerly went into US Treasuries, to now buy yuans. Since Saudi Arabia is just another proxy for the cartel, the cartel's position in yuans is thus increased.)
On the other hand, as Zero Hedge notes in an earlier article, Russia and China have both bought large amounts of gold, which increases their ability to play the cartel's game.
One cannot definitively say how threatened the Cartel feels about all of this, only speculate based on what we know about the ways in which they manipulate value and currency. For the purposes of focusing on currency issues, we have avoided any discussion of other forms of coersion, including geo-engineering (weather manipulation and weather-as-a-weapon, as well as earthquakes and sabotage.
Copyright, 2017, Robert Bows
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