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China, Russia and Gold in the De-Dollarizing World

An asset backed currency, used by Russia and China, may be the biggest challenge to Emperor Dollar.

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Trending and gaining traction throughout the economic world is the increasingly relevant search for safe, stable and secure alternatives to the US Dollar. Some due to geopolitical reasons and pressures, others from recognizing the significantly deepening debt associated with the US Dollar and government. Many have started questioning and doubting aspects of its sustainability and inviolability over the ballooning short and long term. Recently underscored by expected “trade negotiations” with the US’s largest debt holders (Japan & China) which are now to include exploring sovereign debt restructuring, usually an indicator of financial indigestion.

Others are looking to innovative crypto ideas in the hope that extra-governmental blockchain backed mechanisms of peer-to-peer “agreed value” might be the path to securing wealth. In short, all of these approaches are looking for the security which gold together with similar recognized hard assets like silver have provided and assured since the dawn of our varied successive civilizations.

China, Russia, Turkey, Iran and quite a few others see themselves sanctioned, shackled and hindered by the overwhelming market dominance of the American currency and the quickly changing policies linked to it by successive US administrations most especially of late. Some refer to this as the  “weaponization” of the US Dollar as this millennia’s new normal, the gatekeeper of trade permission.

The tariffs introduced by the US government as a form of behavior modification for other nations are understandably unappreciated and are increasingly resisted. It is likely that worsening currency as well as trade tiff’s are in the cards across the board.

The Chinese yuan is gaining internationally among users. Russia, Turkey, and Iran are making payments in their national currencies. Iran recently announced a switch from the dollar to the euro as its reporting currency. Russia and China already have a currency swap agreement that avoids settlements in the greenback. Even Saudi Arabia will have to make a choice probably sooner than later, to stay with the petrodollar fix, or go with its biggest customer – China and therefore the yuan.

China is Russia’s largest trading partner with 15% of Russia’s international trade for 2017. This year it has grown to 17.2%. In 2014 just 2% of payments for Russia’s exports to China were paid in rubles, and 9% of China’s exports to Russia were paid in yuan. In 2017, this has increased to 9% and 15% respectively and continues to grow.

There is persistent speculation and growing talk in the financial markets that Russia and China may be discussing expanding the role gold, silver and possibly other hard assets might have in realigning the value of both the yuan and the ruble independently of the US Dollar. So far it remains in the realm of rumors, then again that too is a start. Whether this remains rumor, or emerges as something more, it is a topic well worth examining if only from a risk management point of view.

There are a number of countries, which no doubt are paying close attention to what may develop. Some to join and some to try and spoil the party. However this plays out, such shifts will not be smooth or pleasant as the effects are global and will resonate throughout all financial systems, especially within the United States.

It is no secret that the central banks in China, Russia, Turkey, India and some other nations have been steadily increasing their physical gold holdings, as well as repatriating their bullion from the United States, for example Germany, and Turkey just recently this past April.

There are persistent and growing unconfirmed rumors here in Moscow that both Russia and China have formulated or are outlining plans to launch some form of a gold-participatory currency system to replace the greenback as the world’s dominant currency. Whether it will be a Ruble or a Yuan, or something entirely different is still unclear, but something interesting is no doubt afoot within this fog of speculation. Already mechanisms have been developed as potential alternatives to SWIFT, both the the Eurasian/Asia regions, and unsurprisingly as a recent development in the Euro Zone as well.

That being said I have no idea how such a system might actually look, it’s organizational profile, how it would be regulated, standardized and traded, or whether it would be a basket of hard assets (gold, silver, energy) securing it, or only gold. The key attractor for the financial world which has traditionally parked its funds in US Dollar government bonds, is if an alternative currency system is governmentally supported, asset backed and interest bearing, then the appeal of that added value and security should make such an alternative realistically appealing. It may be the single key factor which will allow any chances for real competitive use against the Dollar, Yen, Renmimbi or Euro, all of which are like the Dollar – fiat.

Backing currencies today exclusively with gold is highly unlikely; however, there is realistic potential for a new form of currency possibly connected with a state regulated blockchain crypto-currency concept, or the partial exchange within such a currency system for gold as its referenced anchor. These do have possibilities and can occur without unduly testing credulity or imagination.

The trend towards de-dollarization is happening, of that there is little doubt. Equally true is the fact that today this is just an irritant to the US government and the Federal Reserve. If implemented, it will in time erode capabilities the US can bring to bear economically, militarily and politically to all corners of the world through global financing of its dollar debt. That would be much more than just an irritation for the US. After all, according to BIS 80% of all international trade is contracted in US Dollars, it will take some time to shorten such a massive lead.

No major country currently backs its currency with gold, but many have in the past, including the US. The US effectively abandoned the gold standard nationally in 1933, silver in 1968, and completely severed any linkage between the US dollar and gold internationally in 1971. The US since then has remained a fiat money system, meaning the dollar’s value is not linked to any independently redeemable asset other than trust in the stewardship of the US government, and faith in the Treasury Dep’t and Federal Reserve to do the right thing.

Looking back, the inflection point for the US to begin dollar de-linkage from gold and similar assets was to help combat the Great Depression. Faced with mounting unemployment and spiraling deflation in the early 1930s, the U.S. government found it could do little to stimulate the economy. To deter people from cashing in deposits and depleting the gold supply, the US and other governments had to keep interest rates high, but that made it too expensive for people and businesses to borrow. Therefore, in 1933, FDR cut the dollar’s ties with gold nationally, allowing the government to print (“QE”) dollars into the economy, thereby lowering interest rates.

The U.S. continued to allow only foreign governments to exchange dollars for gold until 1971, when President Nixon abruptly ended the practice. It is worth noting that that before delinking from gold, the dollar had a fixed value reference of $35 to an ounce of gold, which limited and severely constrained financial and political policies. The value of gold was not permitted to be set by an open free market. Only after the dollar delinked from gold was the metal allowed to be openly traded as a commodity, at that time notably via the London Fix, and New York COMEX.

It is unlikely that a fully gold-backed currency mechanism will emerge onto the world financial markets as it was before 1933, especially in this interconnected economic and digital information age. However, a basket of hard assets as a reference point or linkage anchor to currencies does have traction, and may very well be what is now being discussed between China and Russia. This especially as the market can and will establish relative values indexed to the assets comprising such a basket, and not be limited to a single fixed price. This also suggests that some control may shift away from the central banks and instead become market sensitized and responsive. This can be a frightening concept, as it is a distinct departure from today’s Fed practices, requiring significant political, procedural and audit realignments.

Russia and China have been in working discussions to introduce gold-backed futures and similar mechanisms to circumvent the U.S dollar. It could be that over the next few decades we may witness the demise of fiat currencies such as the US Dollar, Yen, Euro and the debt excesses the printing of non-asset backed money has encouraged.

Currently, with geopolitical pressures, sanctions and trade tariffs increasing against Russia and China, these two countries have come to be seen as the standard bearers or ‘white knights’ for de-dollarizing global free trade. Whether they want this role foisted on them or not. This view is growing within a number of countries who have been limited and constrained from development by the dominant default role of the US Dollar, and by extension the US Government in its follow-on ability to dictate policies and pressure their sovereign national affairs in the interests of the USA.

The creation and introduction of a gold-inclusive indexed currency mechanism appears to be a likely event, perhaps sooner than we think. Russia has openly said that its national interests can be best served by reducing its exposure to the vulnerabilities and volatilities of global geopolitics by reducing the role of the greenback in its economic affairs.

Moscow and Beijing have been actively reducing their dependence on the dollar in mutual and regional trade. In October 2017, China launched a PVP payment system for transactions in yuan and Russian rubles. This means that payments for Russian oil deliveries to China, which have reached 60 million metric tons per year and continue to increase, are now working without the US Dollar as intermediary. This also has the added benefit to allow confidentiality of transactions. This is not possible if the US Dollar is used as the medium for trade as currently all such transaction details have to be cleared, therefore known in New York.

China’s launch of its own oil futures on the Shanghai International Energy Exchange plays a de-dollarization role and supports the gold-asset function as well. Today, shifting the China oil trade out of dollars into yuan takes between $600 billion and $800 billion worth of transactions out of the dollar each year.

One of the several factors supporting the creation of a Russia/China gold related currency system is that just the other day the global debt has reached $237 trillion.

The IMF warned this past week that the debt burden of the global economy is deeper today than it was before the financial crisis of 2008. The latest numbers for global debt is $237 trillion, up from the $140 trillion before the 2008 financial crisis. It is also worth noting that according to the Bank for International Settlements (BIS), there is also approximately $750 trillion in additional debt outstanding in derivatives, much of which is formally still “on the books” but practically can be considered swept under the financial rug, at least for now.

The US Treasury Department on May 1st said the government borrowed a record $488 billion in the January-March quarter. This exceeds the old record of $483 billion set in the first quarter of 2010, when all stops were pulled to prop up the financial system. The US Treasury continues to face the growing need to finance government operations when annual deficits are heading to new record levels, and a federal budget now normal at over a trillion.

Global debt has increased by roughly $21 trillion in 2017 alone. That is roughly the equivalent of this year’s US national debt. This has led to a forward-looking undercurrent of anxiety in the world’s markets, and a growing desire by some countries to do something to pre-empt being terminally caught up in these increasingly uncertain, predominantly dollar denominated risks.

The latest sanctions against Russian oligarchs and their companies, as well as trade tariffs against China are also having unintended consequences. Rusal is a major aluminum producer. They provide an estimated 6% of the world’s supply. Companies are now scampering every which way to secure new supply sources because the Russian supply might be cut off by US sanctions. The sanctions caused both the Russian stock market and the Russian Ruble to fall sharply and sent aluminum prices soaring. This simply underscores the need to create alternatives to the US Dollar sooner rather than later.

Unintended consequences certainly do not stop with sanctions against Russian companies. The dollarized trade and tariff war between China and the U.S. is also enjoying its moments in the sun. After the US imposed tariffs on China that hit aluminum products, robotics, aircraft parts, vaccines, dishwashing machines and many other items, the Chinese retaliated in turn with tariffs that hit soybeans, cars, and chemical products among others.

China’s response negatively affected agriculture products notably from the very same agricultural states that backed Trump. Aircraft parts and engines were a top U.S. export to China, totaling some $16.3 billion. Soybeans are a top agriculture product with $12.4 billion exported to China every year. Today we are expecting to see a further $200 billion in tariffs imposed on China, with an additional $267 billion package of tariffs “waiting in the wings” if the $200 billion doesn’t win China’s hearts and minds.

As this evolves, we should be seeing inflation in the US and elsewhere rather higher than the Fed’s “2% sweet spot”, in fact it may unpleasantly surprise us all.

Keeping in mind when loans are made in dollars, the debtor is then essentially a hostage, having to agree to the issuing central banks’ policies. The central bank determines the price of those dollars through politically guided monetary policy, and its (fiat) value thanks to currency printing. If such loans were issued in gold or asset-backed instruments, such counterparty pressures would lessen, or no longer be a feature.

China for many years has made it clear that gold purchased in China is to remain in China. Russia, Turkey and recently India are of the same conviction. This allows for each of these nations to be the secure custodian and guarantor of their gold assets, reducing the risk of politically motivated seizure as can happen with currencies and debt instruments.

Decisions have been acted on already by several countries repatriating their gold from the US. This is a telling sign that US control and influence is starting to shift, along with th essential element of trust that had allowed the US to play a custodial role over foreign reserves for so long.

Russia, Turkey, Iran and China are countries that are increasingly seen as threats by the West, in one form or another, and are rocking the currency boat. Various measures have been taken against them to make international trade and negotiations onerous at best. Whether through fear mongering, sanctions or trade tariffs, countries are feeling the force and weight of the US and its allies’ powers. As a result, they are increasingly considering re-enlisting gold and perhaps a basket of similar assets to shield themselves protect their financial reserves, and their ability to function as economically viable independent sovereign nations.

The process has begun, where it may take us over the coming years is the big question and one that will redefine international trade and geopolitics for decades to come. Today, after the US unilaterally exited the Iran nuclear agreement and is reimposing sanctions. North Korea and a host of other nations understandably might wonder if any agreement with the US is workable, and European allies and neighbors of the US are no doubt wondering if marching alongside America is truly in their best national interests.Trust is being frittered away quickly, and trust is what has mostly kept the US Dollar afloat in this guns & butter world. While today this possibility is still in the realm of market hearsay, rumors, and fake news – but in this increasingly curious age what isn’t?

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Clinton-Yeltsin docs shine a light on why Deep State hates Putin (Video)

The Duran – News in Review – Episode 114.

Alex Christoforou

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Bill Clinton and America ruled over Russia and Boris Yeltsin during the 1990s. Yeltsin showed little love for Russia and more interest in keeping power, and pleasing the oligarchs around him.

Then came Vladimir Putin, and everything changed.

Nearly 600 pages of memos and transcripts, documenting personal exchanges and telephone conversations between Bill Clinton and Boris Yeltsin, were made public by the Clinton Presidential Library in Little Rock, Arkansas.

Dating from January 1993 to December 1999, the documents provide a historical account of a time when US relations with Russia were at their best, as Russia was at its weakest.

On September 8, 1999, weeks after promoting the head of the Russia’s top intelligence agency to the post of prime minister, Russian President Boris Yeltsin took a phone call from U.S. President Bill Clinton.

The new prime minister was unknown, rising to the top of the Federal Security Service only a year earlier.

Yeltsin wanted to reassure Clinton that Vladimir Putin was a “solid man.”

Yeltsin told Clinton….

“I would like to tell you about him so you will know what kind of man he is.”

“I found out he is a solid man who is kept well abreast of various subjects under his purview. At the same time, he is thorough and strong, very sociable. And he can easily have good relations and contact with people who are his partners. I am sure you will find him to be a highly qualified partner.”

The Duran’s Alex Christoforou and Editor-in-Chief Alexander Mercouris discuss the nearly 600 pages of transcripts documenting the calls and personal conversations between then U.S. President Bill Clinton and Russian President Boris Yeltsin, released last month. A strong Clinton and a very weak Yeltsin underscore a warm and friendly relationship between the U.S. and Russia.

Then Vladimir Putin came along and decided to lift Russia out of the abyss, and things changed.

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Here are five must-read Clinton-Yeltsin exchanges from with the 600 pages released by the Clinton Library.

Via RT

Clinton sends ‘his people’ to get Yeltsin elected

Amid unceasing allegations of nefarious Russian influence in the 2016 presidential election, the Clinton-Yeltsin exchanges reveal how the US government threw its full weight behind Boris – in Russian parliamentary elections as well as for the 1996 reelection campaign, which he approached with 1-digit ratings.

For example, a transcript from 1993 details how Clinton offered to help Yeltsin in upcoming parliamentary elections by selectively using US foreign aid to shore up support for the Russian leader’s political allies.

“What is the prevailing attitude among the regional leaders? Can we do something through our aid package to send support out to the regions?” a concerned Clinton asked.

Yeltsin liked the idea, replying that “this kind of regional support would be very useful.” Clinton then promised to have “his people” follow up on the plan.

In another exchange, Yeltsin asks his US counterpart for a bit of financial help ahead of the 1996 presidential election: “Bill, for my election campaign, I urgently need for Russia a loan of $2.5 billion,” he said. Yeltsin added that he needed the money in order to pay pensions and government wages – obligations which, if left unfulfilled, would have likely led to his political ruin. Yeltsin also asks Clinton if he could “use his influence” to increase the size of an IMF loan to assist him during his re-election campaign.

Yeltsin questions NATO expansion

The future of NATO was still an open question in the years following the collapse of the Soviet Union, and conversations between Clinton and Yeltsin provide an illuminating backdrop to the current state of the curiously offensive ‘defensive alliance’ (spoiler alert: it expanded right up to Russia’s border).

In 1995, Yeltsin told Clinton that NATO expansion would lead to “humiliation” for Russia, noting that many Russians were fearful of the possibility that the alliance could encircle their country.

“It’s a new form of encirclement if the one surviving Cold War bloc expands right up to the borders of Russia. Many Russians have a sense of fear. What do you want to achieve with this if Russia is your partner? They ask. I ask it too: Why do you want to do this?” Yeltsin asked Clinton.

As the documents show, Yeltsin insisted that Russia had “no claims on other countries,” adding that it was “unacceptable” that the US was conducting naval drills near Crimea.

“It is as if we were training people in Cuba. How would you feel?” Yeltsin asked. The Russian leader then proposed a “gentleman’s agreement” that no former Soviet republics would join NATO.

Clinton refused the offer, saying: “I can’t make the specific commitment you are asking for. It would violate the whole spirit of NATO. I’ve always tried to build you up and never undermine you.”

NATO bombing of Yugoslavia turns Russia against the West

Although Clinton and Yeltsin enjoyed friendly relations, NATO’s bombing of Yugoslavia tempered Moscow’s enthusiastic partnership with the West.

“Our people will certainly from now have a bad attitude with regard to America and with NATO,” the Russian president told Clinton in March 1999. “I remember how difficult it was for me to try and turn the heads of our people, the heads of the politicians towards the West, towards the United States, but I succeeded in doing that, and now to lose all that.”

Yeltsin urged Clinton to renounce the strikes, for the sake of “our relationship” and “peace in Europe.”

“It is not known who will come after us and it is not known what will be the road of future developments in strategic nuclear weapons,” Yeltsin reminded his US counterpart.

But Clinton wouldn’t cede ground.

“Milosevic is still a communist dictator and he would like to destroy the alliance that Russia has built up with the US and Europe and essentially destroy the whole movement of your region toward democracy and go back to ethnic alliances. We cannot allow him to dictate our future,” Clinton told Yeltsin.

Yeltsin asks US to ‘give Europe to Russia’

One exchange that has been making the rounds on Twitter appears to show Yeltsin requesting that Europe be “given” to Russia during a meeting in Istanbul in 1999. However, it’s not quite what it seems.

“I ask you one thing,” Yeltsin says, addressing Clinton. “Just give Europe to Russia. The US is not in Europe. Europe should be in the business of Europeans.”

However, the request is slightly less sinister than it sounds when put into context: The two leaders were discussing missile defense, and Yeltsin was arguing that Russia – not the US – would be a more suitable guarantor of Europe’s security.

“We have the power in Russia to protect all of Europe, including those with missiles,” Yeltsin told Clinton.

Clinton on Putin: ‘He’s very smart’

Perhaps one of the most interesting exchanges takes place when Yeltsin announces to Clinton his successor, Vladimir Putin.

In a conversation with Clinton from September 1999, Yeltsin describes Putin as “a solid man,” adding: “I am sure you will find him to be a highly qualified partner.”

A month later, Clinton asks Yeltsin who will win the Russian presidential election.

“Putin, of course. He will be the successor to Boris Yeltsin. He’s a democrat, and he knows the West.”

“He’s very smart,” Clinton remarks.

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De-Dollarization Tops Agenda at Russia’s Eastern Economic Forum

The Eastern Economic Forum (EEF) was held in Vladivostok on Sept.11-13. Founded in 2015, the event has become a platform for planning and launching projects to strengthen business ties in the Asia-Pacific region.

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This year, the EEF brought together delegations from over 60 countries to discuss the topic “The Far East: Expanding the Range of Possibilities”. A total of 100 business events involving over 6,000 participants were held during the three days.

1,357 media personnel worked to cover the forum. Last year, the number of participants was 5,000 with 1,000 media persons involved in reporting and broadcasting. The EEF-18 gathered 340 foreign and 383 Russian CEOs. Nearly 80 start-ups from across South-East Asia joined the meeting.

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This year, a total of 175 agreements worth of 2.9 trillion rubles (some $4.3 billion) were signed. For comparison, the sum was 2.5 trillion rubles (roughly $3.7 billion) in 2017.

They included the development of the Baimsky ore deposits in Chukotka, the construction of a terminal for Novatek LNG at Bechevinskaya Bay in Kamchatka and the investment of Asian countries in Russia’s agricultural projects in the Far East.

Russian Direct Investment Fund (RDIF), Mail.Ru Group, Megafon and Chinese Alibaba inked an agreement on establishing AliExpress trade joint venture. Rosneft and Chinese CNPC signed an oil exploration agreement.

The Chinese delegation was the largest (1,096 people), followed by the Japanese (570 members). The list of guests included the president of Mongolia and prime ministers of Japan and South Korea.

It was also the first time Chinese President Xi Jinping attended the event to meet his Russian counterpart. The issue of de-dollarization topped the agenda. Russia and China reaffirmed their interest in expanding the use of national currencies in bilateral deals.

During the forum, Kirill Dmitriev, the head of RDIF, said the fund intends to use only national currencies in its transactions with China starting from 2019. It will cooperate with the China Development Bank.

This “yuanification” is making visible progress with Shanghai crude futures increasing their share of oil markets up to 14 percent or even more. China has signed agreements with Canada and Qatar on national currencies exchange.

READ MORE: Eastern Economic Forum opens new chapter in US-Russia dialogue

De-dollarization is a trend that is picking up momentum across the world. A growing number of countries are interested in replacing the dollar. Russia is leading the race to protect itself from fluctuations, storms and US-waged trade wars and sanctions.

Moscow backs non-dollar trade with Ankara amid the ongoing lira crisis. Turkey is switching from the dollar to settlements in national currencies, including its trade with China and other countries. Ditching the US dollar is the issue topping the BRICS agenda. In April, Iran transferred all international payments to the euro.

The voices calling for de-dollarization are getting louder among America’s closest European allies. In August, German Foreign Minister Heiko Maas called for the creation of a new payments system independent of the US.

According to him, Europe should not allow the United States to act “over our heads and at our expense.” The official wants to strengthen European autonomy by establishing independent payment channels, creating a European Monetary Fund and building up an independent SWIFT system.

Presenting his annual program, European Commission President Jean-Claude Juncker called on Sept. 12 for the European Union to promote the euro as a global currency to challenge the dollar.

According to him, “We must do more to allow our single currency to play its full role on the international scene.” Mr. Juncker believes “it is absurd that Europe pays for 80 percent of its energy import bill – worth 300 billion euros a year – in US dollars when only roughly 2 percent of our energy imports come from the United States.” He wants the raft of proposals made in his state of the union address to start being implemented before the European Parliament elections in May.

70% of all world trade transactions account for the dollar, while 20% are  settled in the euro, and the rest falls on the yuan and other Asian currencies. The dollar value is high to make the prices of consumer goods in the US artificially low. The demand for dollars allows refinancing the huge debt at low interest rates. The US policy of trade wars and sanctions has triggered the global process of de-dollarization.

Using punitive measures as a foreign policy tool is like shooting oneself in the foot. It prompts a backlash to undermine the dollar’s status as the world reserve currency – the basis of the US economic might. The aggressive policy undermines the US world standing to make it weaker, not stronger.

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Putin and Erdogan Plan Syria-Idlib DMZ

What the Putin-Erdogan DMZ decision means is that the 50,000 Turkish troops occupying Idlib will take control over that land, and have responsibility over the largest concentration of jihadists anywhere on the planet.

Eric Zuesse

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As I recommended in a post on September 10th, Russia’s President Vladimir Putin and Turkey’s President Tayyip Erdogan jointly announced on September 17th, “We’ve agreed to create a demilitarized zone between the government troops and militants before October 15. The zone will be 15-20km wide,” which compares to the Korean DMZ’s 4-km width. I had had in mind the Korean experience, but obviously Putin and Erdogan are much better-informed about the situation than I am, and they have chosen a DMZ that’s four to five times wider. In any case, the consequences of such a decision will be momentous, unless U.S. President Donald Trump is so determined for there to be World War III as to stop at nothing in order to force it to happen no matter what Russia does or doesn’t do.

What the Putin-Erdogan DMZ decision means is that the 50,000 Turkish troops who now are occupying Idlib province of Syria will take control over that land, and will thus have the responsibility over the largest concentration of jihadists anywhere on the planet: Idlib. It contains the surviving Syrian Al Qaeda and ISIS fighters, including all of the ones throughout Syria who surrendered to the Syrian Army rather than be shot dead on the spot by Government forces.

For its part, the U.S. Government, backed by its allies and supported in this by high officials of the United Nations, had repeatedly threatened that if there occurs any chemical-weapons attack, or even any claimed chemical-weapons attack, inside Idlib, the U.S. and its allies will instantaneously blame the Syrian Government and bomb Syria, and will shoot down the planes of Syria and of Russia that oppose this bombing-campaign to conquer or ‘liberate’ Syria from its Government. The U.S. has announced its determination to protect what one high U.S. official — who is endorsing what Trump is doing there — “the largest Al Qaeda safe haven since 9/11.” He admits it, but he wants to protect them from being bombed by Syria and by Russia.

During recent weeks, the U.S. military has increasingly said that even if the jihadists they’ve been assisting to assemble the materials for a chemical-weapons attack fail to carry it out or to stage one, any attempt by Syrian and Russian forces to destroy the jihadists (which the U.S. side calls ‘rebels’) in Idlib will be met with overwhelming U.S.-and-allied firepower. That would spark WW III, because whichever side — Russia or U.S. — loses in the Syrian battlefield will nuclear-blitz-attack the other side so as to have the lesser damage from the nuclear war and thus (in military terms) ‘win’ WW III, because the blitz-attack will destroy many of the opposite side’s retaliatory weapons. In a nuclear war, the first side to attack will have a considerable advantage — reducing the number of weapons the other side can launch.

If, on the other hand, the DMZ-plan works, then Turkey’s forces will be responsible for vetting any of Idlib’s residents who try to leave, in order to prohibit jihadists and their supporters from leaving. Once that task (filtering out the non-dangerous inhabitants and retaining in Idlib only the jihadists and their supporters) is done, the entire world might be consulted on whether to exterminate the remaining residents or to set them free to return to the countries from which they came or to other countries. Presumably, no country would want those ‘refugees’. That would answer the question.

America’s Arab allies, the oil monarchies such as the Sauds who own Saudi Arabia and the Thanis who own Qatar, and which have funded Al Qaeda and the Muslim Brotherhood, would then be put on a spot, because if they say “Exterminate them!” then their clergy who have provided the moral imprimatur upon those families’ ownership of those nations, will either be in rebellion or else will themselves become overthrown either by their own followers or else by their monarch — overthrown from below or from above.

Alternatively, after Turkey’s forces in Idlib will have allowed release from Idlib of all who will be allowed out, Syria’s and Russia’s bombers will simply go in and slaughter the then-surrounded jihadists and take upon themselves the responsibility for that, regardless of what the leaders of the U.S. and its allied governments might say.

On the night of September 17th in Syria, there were missile-attacks “from the sea” against several Syrian cities; and those attacks could have come from either Israel’s or America’s ships, or from other U.S.-allied ships. Russian Television bannered, “Russian plane disappears from radars during Israeli attack on Syria’s Latakia – MoD” and reported:

A Russian military Il-20 aircraft with 14 service members on board went off the radars during an attack by four Israeli jets on Syria’s Latakia province, the Russian Defense Ministry said.
Air traffic controllers at the Khmeimim Air Base “lost contact” with the aircraft on Wednesday evening, during the attack of Israeli F-16 fighters on Latakia, said the MOD.Russian radars also registered the launch of missiles from a French frigate in the Mediterranean on the evening of September 17. …
The attack on Latakia came just hours after Russia and Turkey negotiated a partial demilitarization of the Idlib province

If the missiles were authorized by President Trump, then WW III has already begun in its pre-nuclear stage. However, if the attacks were launched by Israel’s Netanyahu, and/or by France’s Macron, without U.S. authorization, then the U.S. President might respond to them by siding against that aggressor(s) (and also against what he used to call “Radical Islamic Terrorists”), so as to prevent a nuclear war.

Late on September 17th, Al Masdar News bannered “NATO warships move towards Syrian coast” and reported “The NATO flotilla cruising off the Syrian coast reportedly consists of a Dutch frigate, the De Ruyter, a Canadian frigate, the Ville de Quebec, and a Greek cruiser, the Elli.” Al Qaeda and ISIS have influential protectors.

Ultimately, the decision will be U.S. President Trump’s as to whether he is willing to subject the planet to WW III and to its following nuclear winter and consequent die-off of agriculture and of everyone, in order to ‘win’ a nuclear war, such as America’s aristocracy has especially championed since the year 2006. The nuclear-victory concept is called “Nuclear Primacy” — the use of nuclear weapons so as to win a nuclear war against Russia, instead of to prevent a nuclear war. That concept’s predecessor, the “Mutually Assured Destruction” or “M.A.D.” meta-strategy, predominated even in the U.S. until 2006. Trump will have to decide whether the purpose of America’s nuclear-weapons stockpiles is to prevent WW III, or is to win WW III.

In Russia, the purpose has always been to have nuclear weapons in order to prevent WW III. But America’s President will be the person who will make the ultimate decision on this. And Idlib might be the spark. Netanyahu or Macron might be wanting to drag the U.S. into war even against Russia, but the final decision will be Trump’s.

The ultimate question is: How far will the U.S. go in order to continue the U.S. dollar as being the overwhelmingly dominant global currency?

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Investigative historian Eric Zuesse is the author, most recently, of  They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010, and of  CHRIST’S VENTRILOQUISTS: The Event that Created Christianity.

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