Declassified DIA document shows US supported founding of ISIS, supports Trump policies

US did indeed support the founding of ISIS

By Don Hank

I just now dug up an older article from Zero Hedge that is more relevant today than ever because it shows that the US was one of the supporters of ISIS and it also contains confessions of the DIA (Defense Intelligence Agency) that they support the same pro-terrorist policies that Trump is now putting in place – even as he pretends to oppose ISIS. The fact is, anyone opposed to Assad wants Syria to be controlled by US-supported terrorists. Ask any Syrian Christian.

“Safe havens” are suggested in areas conquered by Islamic insurgents along the lines of the Libyan model (which translates to so-called no-fly zones as a first act of ‘humanitarian war’; see 7.B.)

One of the first foreign policy ideas floated by Trump was “safe zones” ie, no-fly zones. This is the US’s first step to ousting a national leader, as the US did with Ghadaffi, using extreme violence. Trump was preparing the way for removing Assad, the only Syrian leader sincerely fighting ISIS and Al-Qaeda in Syria. I keep getting infantile emails trying to show that Trump really wants peace but that the deep state is standing in his way.

However, this notion is contradicted by things he said even during his campaign. For ex, while he promised not to interfere in Syria, he also stressed repeatedly that the US must build up its armed forces so that “no one will ever mess with us again.” But there were only 2 countries that had superpower-grade military forces that would require more US military might and they were Russia and China. There would not have been any need to build up to take on, say, Iran or N Korea. Therefore, he was most likely thinking about Russia in Syria. To him, despite his intention to be friendly with Russia, that country was “messing with” the US by bombing “our” terrorists in Syria and thereby protecting Assad. He thought that, because of his popularity among patriots, he could get away with this.

He also said in his speech before AIPAC in 2016:

“When I’m president, I will adopt a strategy that focuses on three things when it comes to Iran. First, we will stand up to Iran’s aggressive push to destabilize and dominate the region.”

Woa! Iran, via its army and Hezbollah (declared a terror group by the Neocon Establishment, hoping you were not very smart), was fighting terror in Syria. Only a member of the Deep State establishment – or a deeply disturbed person – would call that “destabilizing the region.” It is a contradiction in terms to say that fighting Al-Qaeda – the group that killed 3000 of us on 9-11 2001 – plus ISIS is a destabilizing action. Only rank Neocons say this. Trump was a Neocon at heart even then and we should have seen that. The goal is a confrontation with Russia, which the article below says the US hoped to be friends with while ousting Assad. Indeed Trump’s secretary of state Rex Tillerson naively tried in his visit to Moscow to persuade the leadership there to back away from Assad based on the groundless accusation that Assad had ordered the use of Sarin gas against his own people at Khan Sheikhoun. It failed then (whereupon Israel assumed its role as proxy) and will always fail. Anyone who knows Putin’s modus operandi knows he is determined to see the US-dominated unipolar world give way to a more fairly distributed power balance, ie, the multipolar world where each nation asserts its sovereign right to self-determination without consulting Washington.

He also said during his campaign that Edward Snowden should be jailed, even though this whistleblower is popular among conservatives, libertarians and many other patriots including Trump supporters, and Snowden’s revelations were helpful in getting Trump elected. Only a sympathizer with the Deep State would rail so bitterly against Snowden. Trump knew which of our buttons to press but his heart was never with us and he was never truly anti-Establishment.

Ominously, in the above-referenced campaign speech to AIPAC, Trump repeated the lie that Iran is the biggest state sponsor of terror – even though Shiite Iran not only has never supported the SUNNI terrorists of Taliban, Al-Qaeda or ISIS and is in fact fighting the latter two in Syria that the US pretends to be fighting. (let me remind you again: it would be theologically impossible for a Shiite country like Iran to support the 100% Sunni terror (ISIS, Al-Qaeda and offshoots such as Al-Nusra). The truth is that the US and Saudi Arabia have always been the biggest terror supporters by far, and the US’s shameful role is confirmed by the below linked article. Trump’s pronouncements sounded like war rhetoric even then, and today we are seeing the anti-Syrian policies expressed early in his presidency.

Keen observers noted these ominous signs, but many supported Trump to prevent Hillary from being elected. Now it is no longer at all clear which of these 2 is the more warlike or the more sympathetic to the Establishment.

So please stop misleading the public into believing that Trump has good intentions but is being thwarted by the Democrats or the Neocons. He himself talked like a Neocon in his campaign. The argument that Trump wants peace but is being hamstrung is the same kind of argument used by Bush supporters to excuse his missteps.

Secondary source and analysis:

http://www.zerohedge.com/news/2015-05-23/secret-pentagon-report-reveals-us-created-isis-tool-overthrow-syrias-president-assad

Primary source:

https://levantreport.com/2015/05/19/2012-defense-intelligence-agency-document-west-will-facilitate-rise-of-islamic-state-in-order-to-isolate-the-syrian-regime/

I had seen in 2014 that the US was the “seat of the Caliphate”

https://www.wasobamaborninkenya.com/InspectorSmith/forum/main-forum/topics-of-interest-to-concerned-american-patriots-general-discussion/7542-washington-the-seat-of-the-caliphate-gulag-bound-don-hank

QUOTE:

“Having watched our military policies in action, with the msm sound muted, I have come to an unshakable conviction: there is no hope that the anti-Christian and anti-American leadership of the GOP and Democratic Party in Washington will loosen its grip on power or change its mind and stop supporting terror. No hope whatsoever. If you think there is, you are deluded and contributing to the success of evil. At some point, I believe our military will realize that they are literally fighting a false flag war to destroy America. There is no other way to see it or say it.”

The above linked articles show I was right.

PS:

After sending some of you the wrong link yesterday, I sent you a good link to my article on Putin adviser Sergey Glazyev’s remarks on the collapse of the dollar as a means of eliminating US aggression. The correct link worked yesterday but was gone this a.m. Not to fear. It is now restored. Seems there was some work in progress last night that blocked it temporarily.

Here it is again:

http://laiglesforum.com/putin-adviser-glazyev-us-aggression-can-be-stopped-only-by-ditching-dollar/4183.htm

 

High noon in Syria

High noon in Syria

by Don Hank

Fox News is between a rock and a hard place. They have always generally been anti-Putin because they have a lot of Neocon supporters. But now Putin has scored big at the UN. Even the British PM is cautiously inching over to his side and Merkel stated last week that she thinks Assad must be included in negotiations over the fate of Syria. Most European countries are taking a wait and see position and will bolt the US monopoly if such is appropriate. Putin has a plan and clearly wants to stop ISIS. Obama sorta has a, well, you know, maybe a plan or something and has been pretending to fight ISIS for years now. Judging by his actions, his plan is to lose the war on ISIS and allow them to romp freely, slicing throats to their hearts content until Assad – the only leader who has been sincerely fighting ISIS for 4.5 years – is gone. While Obama’s position is incomprehensible and confusing, Putin’s position is clear and easily understood. One could articulate it in part as follows:

Syrian Christians overwhelmingly support Assad because they know that if he leaves power, their life expectancy is considerably shorter.

Assad is not a dictator (though Fox still calls him that in the article below). He was duly elected (unlike the Saudis whom we support – NO Neocon voices are calling for the unelected dictator king to step down. How phony and hypocritical can you get?)

Since the popular Assad is still the president, anyone entering Syria without his permission – including the US military in its pretend fight against ISIS – is there illegally per international law. Putin and his coalition have been invited by the Syrian people via their elected leader to fight ISIS and are there legally and legitimately.

In a court of law, no fair-minded judge would hand a victory to the US or find against Putin, but the US, as the “exceptional” and “indispensable” world manipulator, has in the past bought all the judges so to speak. That is changing. I had pointed out before that the accession of almost all US allies to the AIIB was a signal that the hegemon has lost his support in the world community. And without that, he cannot stand. I had also pointed out that Russia is now selling oil to China for yuan (RMB) as part of a larger campaign to dedollarize world trade. The less the USD is used in international transactions, the less it is worth internationally, as one can deduce from my commentary and translation here. Dollar hegemony (which gives the US government and FRB the extravagant ability to print unlimited dollars for its military adventures) is being fought successfully, a step at a time. We are witnessing the changing of the guard. The good news is that, as I pointed out here, the Eurasianism of Putin, China, the BRICS and other Eurasian partners strictly pursues the multipolar principle whereby there shall not be a hegemon. (BTW, if the countries that joined the AIIB had had any reason whatsoever to believe that the AIIB would enable a hegemon – world dictator in the image of the US – to emerge, they would not have rushed en masse to join it and turn their backs on the US-led World Bank and IMF).

I have added comments to the biased Fox report below.

http://www.foxnews.com/world/2015/09/30/boots-on-ground-russian-lawmakers-back-putin-sending-troops-to-syria/

Russia launches airstrikes in northern Syria, senior military official says

Published September 30, 2015

FoxNews.com

 

EXCLUSIVE: Russian warplanes have begun bombarding Syrian opposition [FOX USES THE WORD “OPPOSITION” TO SUGGEST TO UNWARY READERS THAT THESE ARE GOOD FOLKS WHO RECEIVED ARMS FROM THE US TO FIGHT A DICTATOR. HOWEVER, THE BOUNDARY BETWEEN TERRORISTS AND “OPPOSITION” HAS LONG BEEN BLURRED. IT IS COMMONLY KNOWN THAT THE US GOVERNMENT ROUTINELY GIVES ARMS TO ANYONE FIGHTING ASSAD AND THESE PEOPLE THEN ROUTINELY TURN AROUND AND JOIN ISIS OR ANOTHER TERROR ORGANIZATION–DON] targets in the war torn nation’s north, working on behalf of dictator [NEOCON FOX IS OBLIGED TO PRETENT THAT ASSAD IS A DICTATOR BECAUSE THEY ARE BEHOLDEN TO THEIR RICH SUPPORTERS TO KEEP UP THIS CHARADE. BUT AS I POINTED OUT ABOVE, ASSAD IS NOT ONLY POPULAR, HE IS DULY ELECTED. THE WEST HAS CONDEMNED HIM FOR KILLING PEOPLE, BUT THE WEST KILLS ALL THE PEOPLE IT WANTS, INTERFERES IN THE INTERNAL AFFAIRS OF NATIONS, STARTS AND FUNDS COLOR REVOLUTIONS AND ARAB SPRING-LIKE UPRISINGS AND IN SO DOING PLUNGES NATION AFTER NATION INTO ANARCHY, CREATIG A VACUUM THAT IS PREDICTABLY FILLED BY ISLAMIC TERRORISTS, TRIGGERING A MASS MIGRATION THAT IS OUT OF CONTROL. THE KEY US ALLY IN THE MIDDLE EAST IS A TRUE DICTATOR, THE SAUDI KING WHO IS UNELECTED. THERE IS NO GREATER HYPOCRISY THAN FOX CALLING ASSAD A DICTATOR WHILE GIVING THE SAUDI ROYALS A PASS—DON HANK] Bashar al Assad, according to a senior military official.

The official said airstrikes targeted fighters in the vicinity of Homs, located roughly 60 miles east of a Russian naval facility in Tartus, and were carried out by a “couple” of Russian bombers. It was not clear if the strikes targeted ISIS, Al Qaeda or other forces opposed to Assad, who Moscow is aiding [ANOTHER DECEITFUL SUGGESTION THAT PUTIN IS KILLING US APPROVED FORCES OPPOSED TO ASSAD, ALTHOUGH OBAMA HAS ADMITTED HIS ADMINISTRATION HAD ONLY MANAGED TO TRAIN A HANDFUL AT A PRICE OF SEVERAL MILLION DOLLARS PER CAPITA AND THAT THESE MEN HAD MOSTLY DISAPPEARED].  According to a Twitter handle belonging to the Syrian government, the Russian strikes were initiated at the request of Assad. [AGAIN, AS I POINTED OUT ABOVE, THE FACT THAT THE OFFICIAL DULY ELECTED PRESIDENT OF SYRIA GAVE THE RUSSIANS PERMISSION TO BE THERE SHOWS THAT NO INTERNATIONAL LAWS OR TREATIES HAVE BEEN VIOLATED BY PUTIN, WHO, AS A EURASIAN (AS EXPLAINED here), ADHERES TO THE PRINCIPLE OF HONORING NATIONAL SOVEREIGNTIES—SOMETHING THE US HAS NOT DONE FOR OVER A HALF-CENTURY, FALSELY TELLING ITS PEOPLE THAT IT HAS EVERY RIGHT TO INTERFERE IN THE INTERNAL AFFAIRS OF ANY NATION IT DISAGREES WITH. BY REPORTING THIS, FOX IS ALSO UNWITTINGLY HIGHLIGHTING THE FACT THAT THE US AND ITS ALLIES IN SYRIA ARE THERE ILLEGALLY AND AGAINST THE WILL OF THE SYRIAN PEOPLE. FOX, OF COURSE, WANTS US TO THINK RUSSIA IS THE VIOLATOR HERE BUT JUST THE OPPOSITE IS TRUE. THE CASE IS CLEAR CUT AND ONLY THE BRAIN DEAD COULD FAIL TO SEE WHAT IS ACTUALLY HAPPENING—DON]

The development came after Pentagon officials brushed aside an official request from Russia to clear air space over northern Syria, where Moscow intends to conduct airstrikes against ISIS on behalf of Syrian dictator [NO, FOX. HE IS NOT A DICTATOR, AS I HAVE SHOWN ABOVE. THE SAUDI KING IS INDEED A DICTATOR (WHO RECENTLY BOMBED A WEDDING PARTY AND KILLED DOZENS OF INNOCENT PEOPLE) BUT YOU WOULD NEVER CALL HIM THAT. WHY? —DON] Bashar al-Assad, according to sources who spoke to Fox News.

The request was made by a Russian three-star general who spoke with U.S. officials at the American embassy in Baghdad, sources said. The general, who was not identified, used the word “please” when delivering the verbal request, known as a “demarche,” according to the written transcript of the exchange.

“If you have forces in the area we request they leave,” the general said.

A senior Pentagon official said the U.S., which has also been conducting air strikes against ISIS, but does not support Assad, said the request was not honored.

[SO IF THE US ENTERS SYRIA IN VIOLATION OF INTERNATIONAL LAW AND IS FIRED UPON BY A NATION THAT IS THERE IN COMPLIANCE WITH INTERNATIONAL LAW, THEN THE US HAS NO MORAL RIGHT OR AUTHORITY TO COMPLAIN ABOUT ANY DAMAGE IT SUFFERS AS A RESULT OF THIS TRESPASSING. (THE PENTAGON MUST ALSO EXPLAIN WHY IT ENDANGERED ITS PERSONNEL BY FORCING THEM TO ENTER TERRITORY ILLEGALLY). THE US HAS BEEN IGNORING INTERNATIONAL LAW FOR DECADES AND GETTING AWAY WITH IT BECAUSE IT WAS CLEARLY THE STRONGEST NATION. BUT NOW WE HAVE A COALITION OF RUSSIA WITH CHINA (THE LATTER MAY OR MAY NOT PARTICIPATE IN THE RUSSIAN LED COALITION). TOGETHER IT IS LIKELY THAT THEIR POWER IS GREATER THAN THAT OF THE US. FURTHER, AND MORE IMPORTANTLY, OUR ALLIES ARE NO LONGER SOLIDLY BEHIND US. THIS CONFRONTATION BETWEEN THE US IN ITS ROLE AS A VIOLATOR OF INTERNATIONAL LAW AND RUSSIA IN ITS ROLE OF THE PARTY REQUESTED BY THE SYRIAN PEOPLE TO ENTER SYRIA, HAS THE POTENTIAL TO SMASH WHAT IS LEFT OF US PRESTIGE AND POWER. IT DIDN’T HAVE TO BE THIS WAY BUT A COALITION OF THE TWO MAIN POLITICAL PARTIES RELENTLESSLY AND RECKLESSLY PURSUING INEXPLICABLE NEOCON POLICIES (WITH THE TACIT PERMISSION OF A BRAINWASHED PUBLIC THAT HAS BEEN TAUGHT TO FOLLOW THE LEADER AND NOT TO THINK FOR ITSELF) CAN’T BE EXPECTED TO WIN FRIENDS OR WARS. WE CAN ONLY HOPE AND PRAY THAT THE ABOVE-CITED PENTAGON OFFICIAL IS BLUFFING – DON]

 

Russian sanctions hurt (II)

Russian sanctions hurt (II)

 

by Don Hank

I have shown in a previous commentary that sanctions against Russia have really hurt. But not the Russians. They boomeranged on the US. How? By strengthening economic and military relations between Russia/Eurasian region and the rest of the world (eg, the accession of almost all US allies to the AIIB), military and economic coalition with China, lucrative contracts with the Saudis, India, etc.

As the icing on the cake, today I was translating an article in the Chinese economic daily finance.sina.com which shows that Russia in June sold a record amount of oil to China, and this, according to the article, for two reasons:

1—The Saudis obligingly raised their Asian benchmark oil prices selectively for Asia only, giving Russia the edge as an oil seller. (See the below time line for clues as to why the Saudis did this).

2—These oil deals with China are settled in yuan (RMB) making them more attractive to China in terms of both monetary policy (strengthening the RMB) and economics.

The latter fact is bad news for the dollar. The main thing propping up the USD is country-to-country trade settled in USD. The whole purpose of the petrodollar agreement with the Saudis in 1973 was to oblige them to accept payment only in USD for the purpose of maintaining an artificially high value of the dollar. Now Saudi Arabia itself is in fact sabotaging that deal, while sticking to the letter of it. This was a stroke of genius on someone’s part, and I think that someone was Russian President Putin.

Look at what Putin had been up to since no later than the end of 2014:

Timeline of Russia-Saudi negotiations.

1—December 2014, Putin meets with Saudi Intel Chief in Moscow

http://en.trend.az/world/arab/2218066.html

2—April 2015 King Salman bin Abdulazziz el-Saud calls Putin, sets up visit in June. (Was this motivated by the outcome of the Dec meeting?)

http://en.kremlin.ru/events/president/news/49304

3—June 2015, Saudis raise benchmark oil price for Asia

http://www.reuters.com/article/2015/06/05/us-saudi-oil-price-idUSKBN0OL04720150605

4—June 2015, Russia signs 6 nuclear energy contracts with the Saudis (quid pro quo for the raised Asian oil prices?)

http://uk.reuters.com/article/2015/06/19/uk-saudi-russia-nuclear-idUKKBN0OZ10R20150619

5—July 2015, Russia announces sale of Iskander missiles to Saudis (more quid pro quo for the raised Asian oil prices?)

http://www.presstv.com/Detail/2015/07/04/418758/Russia-Saudi-Arabia-Iskander-missile-Yemen

There are no coincidences in events involving Russia. The tit-for-tat here is obvious. The Saudis got beefed up defenses and nuclear energy deals. Russia got a chance to sell more oil. Of course, for obvious reasons, the paper trail here omits the main details. The Saudis never disclose all the details of their agreements with other countries. But anyone who pays attention and knows what to look for can easily extrapolate the hidden details of these bargains.

Watch for more surprises soon.

As Donald Trump said: The decision makers in US policy are stupid.

Don Hank

 

PS: Speaking of stupid policy, did you happen to read about that fist fight that broke out in the Japanese Parliament over the latest change in the Japanese constitution allowing their armed forces to join with the US in its military adventures? An increasing number of Japanese are waking up to the insanity of US military policy and want nothing to do with US wars designed to be lost. Yet establishment thugs managed to pass this potentially disastrous piece of legislation, almost certainly under pressure from the war hawks in Washington.

Russian and US tactics are as different as day and night. Russia makes offers that tempt and reward. The US applies pressure and threats to punish.

Which side is winning?

Russian Sanctions hurt

Sanctions against Russia hurt

 

Don Hank

 

A reader tells me that the sanctions against Russia have been hurting them financially.

This is the perception throughout the West so far, unless you read reports from off the beaten trail. And then you see can easily through the lies.

You see, Western oligarchs are focused on keeping the world poor while robbing the little guy, and that is becoming an open secret. Eastern leaders can see this as a huge opportunity for doing business in ways that make everyone richer and better off. All they need to do is avoid the clumsy mistakes of the US oligarchs, and that is easy.

I have been forwarding articles showing that sanctions are not hurting Russia at all. They are gaining ground much faster than we are. Almost every one of our allies turned their backs on the World Bank (US based and led) and went over to the Chinese AIIB. This is a step toward dedollarization of world trade, which the Western press ignores pointedly (I pointed this out here http://www.renewamerica.com/columns/hank/141009)

In fact, the drop in the ruble is a huge boon for Russia, enabling them to sell more competitively to trade partners.

Then the Saudis struck deals with Russia for more powerful arms than we had ever sold them. That too is money in Russia’s bank.

Then about a week ago, almost every Middle Eastern leader met with Putin in Moscow, showing that they are pivoting away from the US and trusting Russia. For Putin that was like taking candy from a baby, because when a country’s government and oligarchs have cheated and lied repeatedly, eventually no lone trusts them. And that government is Washington.

In June Russia broke a record, selling more oil to China than the Saudis ever had sold them! The trade with China bypasses the dollar, using RMB only. Another major step toward dedollarization and loss of prestige for the dollar.

The Saudis are cooperating by charging more for their oil sold to Asia than is sold to the West. This helps Russia tremendously and is a clear signal that those closed door deals with the Saudis involved concessions to Russia in exchange for those weapons deals.

Now Russia is making deals with India for joint oil projects. These will almost certainly be denominated in currencies other than the dollar, another step in devaluing the USD.

Then there is the New Silk Route, a joint project with China to connect far flung regions for trade. Will the trade deals be in dollars? What do you think?

Rather than harming Russia, the sanctions drove them into the arms of our one-time allies. I don’t think they are coming back. My communications with Europeans shows they no longer trust the US, particularly since the bogus US subprime paper sold all over Europe, which set the stage for the current crisis there. Virtually every educated European knows this and, while their leaders remain discrete, they are waiting patiently for Washington to fall.

Russia’s new deals and sales of arms and oil are an indirect product of our sanctions and Russia is stronger now in trade and in world prestige than it ever was before.

Sanctions not only failed but they wound up greatly strengthening Russia!

The old Wolfowitz policy of encircling Russia has failed miserably as any fool knew it would. Russia is quickly emerging as the winner. Our policy makers are, to paraphrase Trump, STUPID!

It all reminds me of the Japanese emperor Hirohito in the last days of the war. He refused to believe that Japan could lose, even after the first nuke fell on one of his cities.

So the US dropped another.

Each of Putin’s actions is like one of those nukes, greatly curtailing US strength and prestige. Yet, Washington, caught in a paroxysm of normalcy bias, continues to forge ahead with its horrible policies, somehow convincing itself that it will win.

Let us hope and pray that whoever is elected our next president will start reversing these disastrous fraudulent foreign and financial policies that make America poor and garner the ridicule of nations.

And you know what? He may not have much choice.

Chinese monetary policy expert spills the beans, but not to the West

Warning from top Chinese monetary policy maker

My translation of a report in Economic Daily (Jingji Ribao) on the July 20, 2014 interview with Chen Yulu re. RMB internationalization follows below.

Note: RMB is the acronym for China’s national currency, the renminbi, also known as the yuan (not to be confused with the Japanese yen). Renmin means “the People” in Chinese, while “bi” means currency – hence, the People’s currency.

Background: As of 2013, the RMB has been convertible in current accounts (but not capital accounts). Until then, if you wanted to convert the RMB into one of the non-dollar currencies, you generally had to first convert your RMB into dollars, a cumbersome process that discouraged investors from making many transactions.

Why I decided to translate this article:

I first found this article in a Japanese language translation and decided to find the original, linked below.

Not at all surprisingly, I found no translation of it into English anywhere (except for an atrocious machine rendition that does not merit the descriptor “translation”). Why no surprise? I had already had experience with the huge black holes in the Western financial press, as reported here (the term “dedollarization” in that report is for all intents and purposes synonymous with “RMB internationalization”as used hereinbelow).

Why this article was not run in the Western press:

While many of the facts cited by Mr. Chen are to be found in the Western press and also in English language articles posted in China (for example, by the Bank of China), the time frames of Mr. Chen’s predictions of the RMB’s internationalization growth differ shockingly even from those reported in Chinese publications posted in English. Obviously, the Chinese don’t dare tell us the truth and I can’t blame them.

Mr. Chen tells his Asian audience that the RMB internationalization index (RII) will exceed that of all currencies except the US dollar and the euro within anywhere from 3 to 5 years, whereas other forecasts in English language journals estimate that time frame at 15 or more years. The idea seems to mitigate what most will see as bad news and to avoid any counter-measures from the Western central bankers (although it could be that they are also in on the plot). It strikes me that if Mr. Chen were just spouting hype to sell the rmb, then he and the rest of the economic bosses, eg, at the Bank of China, would post these things in English. But since they post them only in Chinese (and also allowed on Japanese site to post a translation of this interview), it seems that the West is being kept in the dark. The fact that rmb clearing centers are opening all over Europe is also an important, and ominous clue as to what is happening behind the curtain. One could make the case that the vast majority of our ‘allies’ are in fact quietly sabotaging the dollar. And if you were a European and your finances had been wrecked by the US derivatives bubble, you  would understand the sentiment behind that. In fact, the sanctions against Russia also dealt Europe a dangerous blow, and yet, their governments don’t dare defy Washington and go their own way. Think about it. France’s BNP Paribas was fined by the US for a misdemeanor that is perfectly legal in Europe and they lost 9 billion dollars to an increasingly ruthless hegemon. Who today is truly sympathetic to the US government?

The World Bank had estimated in 2013 that China’s economy “will become the [world’s] largest by 2030.” Well, that happened last week. Can you see that we are being kept in the dark? 

This article was translated by an ordinary citizen (who happens to be a professional translator) free of charge, for both investors and ordinary middle class citizens who will need to be prepared for a collapse of the dollar sooner than most would expect, at least if we trust the media that are being paid good money to prepare us but refuse to do so or are perhaps also hapless victims of normalcy bias.

Finally, while Mr. Chen says the RMB is not intended to challenge the dollar, now that the Chinese economy exceeds ours, guess what will happen to the dollar once the RMB internationalization index surpasses the dollar’s.

Hint: the main ingredient in the value of any currency is trust. Western monetary policy aims at 2% annual inflation and cheekily calls that “stabilization,” routinely causes bubbles in various markets and fosters the creation of essentially worthless derivatives denominated in the US dollar. Chinese policy has, so far at least, not fallen into anything resembling this kind of irresponsible behavior. European markets were hit hard by this corrupt US monetary policy and they are not happy. This is, in my judgment, why the RMB clearing centers have been established all over Europe (as well as elsewhere) but not in the US, whose investors apparently want to go down with their own ship.

I am convinced that all or most of our allies have lost all trust in the US government and are quietly deserting the ship.

My only question is: what took them so long?

Don Hank

Author’s email: zoilandon@msn.com

http://finance.sina.com.cn/money/forex/20140722/054019778623.shtml

Internationalization of the RMB is not a challenge to other currencies

05:40, July 22, 2014 Economic Daily, I have something to say (11 participants)

Staff reporter: Zhang Wei Zhang Lichen

On July 20, the Renmin University of China issued the “2014 Renminbi (6.1546, 0.0044, 0.07%) internationalization report,” which shows that in 2013 the rmb internationalization index (RII) further accelerated. The report notes that the internationalization of the RMB is not intended to challenge the US dollar or other international currencies; the renminbi is taking on more international monetary functions, rooted in the internal demands of the international market.

Since the beginning of 2012, the People’s [Renmin] University of China has been releasing a series of annual research reports on the internationalization of the RMB, and has proposed an RMB internationalization Index (RII), which objectively describes of the extent of Chinese yuan use in overall international economic activities. The index not only tracks trends in 3 areas, namely, global renminbi-denominated trade, financial transactions and foreign exchange reserves, but enables a convenient horizontal comparison with other major international currencies. On July 20, upon release of the “2014 RMB internationalization Report,” Economic Daily reporters on issues relating to the internationalization of the RMB were granted an exclusive interview with Chen Yulu, a member of the Central bank Monetary Policy Committee and president of Renmin University of China.

According to data in a recently released report, by the end of 2013, the RII reached 1.69, as compared to 0.92 at the beginning of the year, a gain of 84%. What is the reason for this rapid growth?

Chen Yulu: The RMB internationalization Index (RII) accelerated further in 2012, due to high-growth, reaching 1.69 by the end of 2013. In contrast, over the same period the international status of the dollar remained stable, while the euro, and British pound rose only moderately, and the internationalization of the yen declined slightly.

This is because China is number one in global trade, and currently has the world’s second largest FDI (Foreign Direct Investment) inflows and the third largest direct investment outflows. In cross-border trade, more and more companies are using RMB settlement. In 2013 the share of trade in goods settled in RMB exceeded 10%. In terms of investment, foreign direct investment in RMB 448.13 was billion while overseas direct investment amounted to 85.61 billion RMB, the total reached 1.9 times over the same period last year. This is the main reason for the rapid growth in the RII.

According to the latest data, in 2014, the first and second quarter RII’s were 1.74 and 1.96, respectively. By the end of this year, based on a conservative estimate, the RII is expected to climb to 2.40. Following system reform and the release of dividend policy, RMB direct investment and credit in international markets will significantly increase. If the  BRICS Development Bank and the China Latin America Cooperation Forum proceed smoothly, an optimistic forecast for the RII by the end of 2014 might be in excess of three. Barring any major adverse events, the international use of the renminbi will exceed the levels of the yen and the British pound in anywhere from 3 to 5 years, with the RMB becoming the world’s third largest currency after the dollar and the euro.

The accelerated process of RMB internationalization seems to suggest a challenge to the status of dollar, the euro and other international currencies. What do you think?

Chen Yulu: The internationalization of the RMB is not going to challenge the dollar or other international currencies. In fact, the RMB is assuming more international monetary functions as a result of internal demand in the international market. In particular, the international financial crisis in 2008 demonstrated that there are significant contradictions in the current international monetary and financial landscape. For example, the United States accounts for 20% of the global total economy, but supplies 52% of international currency as a public good. The spirit is willing but the flesh is weak. In the last two years, a number of international financial centers in Europe have been actively showing intensive demand for RMB-traded products, and have signed RMB clearing agreements with China. This shows that the RMB internationalization is a phenomenon that has developed in response to adjustments in international economic and trade patterns, with the chief motivation coming from international market demand. China’s push can be seen as an echo of this demand.

Secondly, China has become the world’s second largest economy, and this entails a greater responsibility and obligation to provide global public goods, including the response to the global liquidity shortage. Thus it has become the lender of last resort, participating in global currency market rate pricing, establishment of a stable international currency exchange rates system and so on. Due to China’s own increased economic strength, this is the default option for creating a stable monetary and financial environment for global economic development.

We also need to note that the yuan is far from becoming a core international currency, and does not pose a threat to the status of the dollar or the euro. Therefore, we need to consider the larger pattern and see the internationalization of the RMB as a natural response to adjustments in the international economic and financial situation, without assigning it too many other interpretations.

Currently, the establishment of offshore markets is the main thrust of the RMB internationalization process. Can you give us an overview of the global offshore RMB market? How will it impact the development of Chinese enterprises and financial institutions

Chen Yulu: Hong Kong is still the world’s largest offshore yuan market, where we find not only the most important clearing platform of cross-border trade in RMB, but also the largest pool of offshore renminbi funds. The central government has expressed clear support for entering a new stage of domestic development following the construction of offshore financial centers in Hong Kong. Elsewhere in Asia, in addition to Singapore and Taiwan and Macau, Seoul has followed suit with the signing of an RMB clearing agreement.

A number of international financial centers in Europe, such as London, Frankfurt, Luxembourg, Paris and Zurich are actively expressing the desire to establish offshore financial centers. This year, China signed RMB clearing agreements with Germany, Britain, France, Luxembourg and other countries. This is likely to cause a reversal, with the size of the European market lagging significantly behind Asia. In addition, almost all international financial centers are being established on fears of falling behind in the offshore renminbi business. This means that in addition to Asian high yield and European new markets, the RMB offshore market development will be a fast-growing trend in the global situation.

From a domestic perspective, the offshore market provides domestic enterprises new financing channels, and allows companies to take advantage of low-cost funds in overseas markets, solving difficult financing problems; at the same time, it also provides a financing platform for enterprises “going offshore,” and is conducive to fostering international competitiveness in local multinational companies. In addition, the offshore market can encourage Chinese financial institutions to accept otherwise-daunting international competition, improve service levels and innovation capacity as quickly as possible, and for China’s benefit, create favorable conditions for carrying forward capital account reform.

What challenges is the establishment of current offshore yuan markets facing?

Chen Yulu: Right.  Although the establishment of offshore renminbi markets is accelerating, some of the main obstacles must be overcome as quickly as possible. First, we  lack an efficient, secure and cost-effective offshore renminbi clearing system. This affects the willingness of domestic and foreign enterprises and financial institutions to use the renminbi and restricts the scope of offshore renminbi transactions. We need to set up a global offshore RMB clearing system of international scope as soon as possible, transforming it into a gross settlement system functioning in real time corresponding to the operating time.

Second, the current legal framework for offshore RMB market system has not yet been established. The establishment of the offshore RMB market must tackle conflicts in the field of international law, improving as soon as possible the terms of confidentiality, and implementing strict anti-money laundering procedures to curb the use of offshore financial centers to achieve illicit transfer of funds abroad. We also need to strengthen tax collection of international taxes on Chinese territory, to combat tax evasion and prevent loss of tax revenue.

Third, the offshore renminbi financial product chain and financial service capabilities of financial institutions are not yet ideal. The offshore business of Chinese financial institutions in general is still restricted to the traditional deposits, loans and international settlement business. There is an urgent need to achieve breakthrough innovation in financial product development. In addition to requiring more Chinese financial institutions to take on added functions, we must also encourage foreign financial institutions to develop businesses and innovative products.

Fourth, once the offshore financial market reaches a certain size, it will impact on the mechanism of onshore market interest rate and exchange rate formation, which may weaken the effectiveness of monetary policy, creating new challenges for the domestic financial regulatory system. Offshore renminbi market transactions will make interest rate and exchange rate determining mechanism more complex, and even affect yuan pricing. This requires the combination of two-rate marketizing reform, and the application of the scientific method in research and in the regulation of the monetary policy system. Establishment of a new macro-prudential financial regulation mode, accommodation of the offshore market within the monitoring range, strengthening international cooperation in financial supervision, and ensuring a smooth-running offshore RMB markets, and rapid, sound development.

 

Are you wasting money on one of those “specialized” news sites?

Are you wasting money on one of those “specialized” news sites?

 

Don Hank

 

I recently had a complaint about a comment of mine on my private forum (applicants may apply at zoilandon@msn.com) regarding Stratfor, which I said was a propaganda outlet. A reader was very upset and said that he had worked with companies that paid money to subscribe to Stratfor for information that helped them plan economic strategy. The implication was that they could not be a propaganda outlet if serious companies paid them for hard to find information. I do want to point out that the msm are also charged with being a propaganda arm of the US government. This does not mean they are literally paid hard cash for government-favorable reporting. It goes much deeper than that. What I call “propaganda” is what we call the oficialista viewpoint here in Latin America, for example. It is a viewpoint that is inhaled with the air that people, especially journalists, breathe. Anyone expressing a contrarian viewpoint is persona non grata in government circles and risks not getting invited to official press conferences – or worse. Thus there is a constant inflow and outflow of the officialist viewpoint at outlets like Stratfor. No one has to bribe or pay them to parrot the official party line. It is in their blood stream.

The Stratfor article I was commenting on was one in which the author was fretting that Latvia had a pro-Russian political party that was rapidly growing, raising “concerns” as to what Russia might eventually do.

Of course, the real concern for those who like democratic systems would be that some tyrannical outsider might try to force Latvia to remain aligned with the West despite its desire not to – just as the East of Ukraine is being forced to go along with the wishes of Western Ukraine and the EU-US-NATO bloc. (And yet, Scotland gets to hold a referendum and no one in the Western world accuses them of illegal behavior for breaking away from a sovereign country, ie, the UK).

The Western press, whether a for-profit geopolitical analysis site like Stratfor or the msm, never misses a chance to focus on what evil deed Russia may do but almost never focuses on what might make an EU member like Latvia want spontaneously to align with Russia and eventually drop out of the EU. The real issue, left unmentioned, is not what Russia will do but the domino effect of countries like Latvia harboring anti-EU Russia-friendly parties which are growing in leaps and bounds. These include the UK, Holland and France, countries that if they should drop out – or I should say when they drop out, will completely sink the entire EU grand projet. (Don’t worry, though. Your favorite pay-to-read site will never annoy you with that piece of trivia). Once the EU falls, as it must, that will not be Russia’s fault. If Russia fills the trade vacuum, that is hardly an act of war. It is what we used to call the free market back when there was one.

But the folks at Stratfor think that the Latvian development is about Russian misbehavior.

And you know what irks me no end?

In stark contrast to the very localized development in Latvia, which is none of our business, there is a worldwide development that is about Russia – and also about China and eventually the rest of the BRICS countries – a development that is our business and the business of Stratfor subscribers, like it or not, and that development is dedollarization, which if the msm is doing its job of blacking it out properly, you probably have never heard of.

Dedollarization, the movement that could destroy the US economy, is well underway and includes not only the 5 BRICS members but also Japan, some African countries and some European countries, like France (see my sampler of foreign press articles below). Why France? Because a French bank was soaked a world record fine a while back for trading with some US-blacklisted countries and they are getting fed up with the bullying.

Hey, Stratfor, want something to warn your subscribers about?

How about warning them about dedollarization and the US’s suicidal practice of imposing gargantuan fines on foreign banks at the whim of the US government? Or the practice of provoking Russia by siding with known fascists in former COMECON countries that they still want to trade with. Dedollarization is the chickens coming home to roost. Oh, but that’s embarrassing for the US elites who implement these suicidal policies.

Besides, Russophobia, a popular form of racism, is all the rage in Washington, and Russia is the whipping boy du jour. More to the point, in a country where Russophobia is the official fare, it would be embarrassing to admit that Putin turned the tables on the dull witted Western elites with a brilliant answer to the sanctions against Russia, namely, dedollarization of international trade – the use of currencies other than the dollar to transact.

It is vital for you to know something that the msm will never tell you: there are 2 reasons that the USD is still worth money:

1. Since the Bretton Woods agreement, the world is obliged to use the USD in international trade; and

2. The US military.

Dedollarization is the start of a process that will slowly erode these 2 factors.

With all this in mind, I went to the Stratfor site to see how many articles they had relating to dedollarization, a phenomenon poised to kill the USD and hence bring hyperinflation to the US. (Dear Stratfor readers: don’t you suppose a bankrupted USA full of hungry people might be just a wee bit more important than some folks in the mini-country of Latvia who prefer trading with a stable country like Russia – which has a capitalist economy without the impediment of Keynesianism and whose debt, unlike ours, is only a modest fraction of GDP?).

I can’t tell you how unsurprised I was to find the following using “dedollarization” as the search term at the Stratfor site:

 

Argentina, Brazil: Countries Plan To De-Dollarize Commerce

Argentina and Brazil plan to de-dollarize commerce in their countries in the first part of 2008 to…

 

That’s it. So if I am a Stratfor reader, I am led to believe that dedollarization is a South American phenomenon, confined to Argentina and Brazil. Meanwhile Europe is teetering on the brink of dedollarizaton, African countries are dedollarizing, and China, Japan and Russia have already taken that route in major international transactions. Now remember: Stratfor charges money to its subscribers for refusing to give them vital information that the long term investor can hardly be without!

But you are not alone, Stratfor. Guess how many articles the writer-for-hire Wall Street Journal had relating to dedollarization when I performed that search? Ready for this? Here ya go:

 

SEARCH

Advanced Search

Sorry, there are no results for your search query, please try another search.

ROFL! I love this stuff!

For good measure, I decided I might as well try the pay-to-read New York Times. Since they peddle these big thick wads that take whole forests for a week’s worth of news, why they would surely carry something about dedollarization, wouldn’t they?

Sure.

Here is what the internal search engine managed to dredge up:

 

Challenge for Peru: Shoring up sol

“Dedollarization has been a very slow process,” Peru’s central bank president, Oscar Dancourt, said. “But we’re making progress, we’re on the …

So if we trust Stratfor and NYT, dedollarization is only happening in South America. And if we trust WSJ, it doesn’t exist. Nothing to worry about. Certainly not the nail-biting that Latvia’s growing anti-EU party will cause those Stratfor subscribers, who apparently all hold mostly EU bonds in their portfolios and whose worst nightmare is a coup in Latvia. The Russkies are coming! The Russkies are coming!

Now, if you don’t like the word “propaganda,” don’t use it. In fact, you may, if you like, send me your suggestions for a word that better fits an international news analysis site that keeps vital information away from the reader while plying them with news about the internal politics of one of the smallest countries in the EU – and spinning even that tidbit to blame it on Russia, the whipping boy of the officialistas in Washington, DC. But just because our government is running a hate-Russia campaign does not mean that Stratfor is deliberately giving Washington what it wants, does it? Of course not. It could be just a remarkable coincidence. Yeah.

So omitting that harsh word “propaganda,” would you at least admit that the media, even the subscription-only media that soak you plenty for their gems of hard-to-find knowledge that is all over the internet for free, are at least keeping important news – and I’d have to say the most important news – safely away from your eyes?

Finally, for those who never heard of dedollarization (how would you know from the msm if even outlets specialized in international economic news don’t carry the story?), I will admit that my information on the subject originally came from sites like The Economic Collapse, FedUpUSA and Zero Hedge. I trust these sites because, for one thing, they quote sources, and for another, they don’t sound like a broken record cut in Washington. Nonetheless, for the hard core doubters, I was challenged to do my own search of the world press on dedollarization, just to make sure you wouldn’t think I make stuff up. Below is a list of links amounting to no more than about 1% of the dazzling array of foreign articles on dedollarization that I found in German, French, Spanish, English and Chinese – and I’m talking about the real dedollarization, not obscure events localized in South America but an economic freight train bearing down on you and me as I type. I skipped Russian this time even though that is one of my primary sources for this information. That’s because the American public is trained like Pavlov’s dogs to reject all things Russian and there is little point sending the reader to, say, Russia Direct or the like because, unlike our reliable msm, Russian news is pure “propaganda,” right, Sheeple?

Oh, and did I mention that, despite the fact that Stratfor charged readers for its “news” report on Latvia, that story was all over the internet, here, for example, and wouldn’t have cost the subscribers a dime to get all the details. Without the racist anti-Russian propaganda.

 

Germany:

I first searched the word for dedollarization, Entdollariserung.

My goal was to find sources that did not quote the usual US blogs on this subject because, while I personally have the highest regard for the 3 blogs mentioned above, the elites want us to believe that only “bona fide” sites like WSJ or NYT are worth quoting. So while some foreign sites run translations of Tyler Durden or Michael Snyder on this subject, I chose to skip those and picked sites like this one:

http://www.contra-magazin.com/2014/06/die-entdollarisierung-der-russischen-wirtschaft-schreitet-voran/

 

The below German language article cites ITAR-TASS quoting the Russian Central Bank office and also quoting Vladimir Putin in Shanghai following a talk with Xi Jinping announcing closer cooperation between the central banks of Russia and China. (I found references to this well-known conference in several languages).

http://freies-oesterreich.net/2014/08/10/russland-und-china-wollen-bilateralen-handel-kuenftig-nicht-mehr-ueber-dollar-abwickeln/#more-2513

 

How about a French site discussing how BRICS countries and France are weighing the possibility of dedollarizing due in part to the draconian fines imposed by the US on French banks (for doing things that are legal in France!)?

http://resistanceauthentique.wordpress.com/2014/08/26/laffaire-bnp-paribas-et-la-dedollarisation-du-monde/

 

Central Bank of the Congo is dedollarizing (report in French):

http://tsimokagasikara.wordpress.com/2014/05/31/rdc-un-pas-vers-la-dedollarisation-une-nouvelle-reglementation-de-change-a-la-bcc/

 

Angola bank is dedollarizing (report in English):

http://www.portalangop.co.ao/angola/en_us/noticias/economia/2014/5/26/Reserve-bank-denies-report-foreign-currency-shortage,77c30ca5-8603-406c-b65d-d2e45b453b39.html

Quote: The official said that the economy is in a course of stability and there is a set of measures that have been taken aimed at the maintenance and sustainability of the framework which is the process of de-dollarisation of the economy, started four years ago.

 

El País, In Spanish, reporting directly on meetings of BRICS in Fortaleza, Brazil, where dedollarization was being planned:

http://www.portalangop.co.ao/angola/en_us/noticias/economia/2014/5/26/Reserve-bank-denies-report-foreign-currency-shortage,77c30ca5-8603-406c-b65d-d2e45b453b39.html

 

BRICS countries “must continue dedollarization” (report in Portuguese)

http://www.efe.com/efe/noticias/brasil/economia/brics-paises-emergentes-devem-prosseguir-com-desdolariza-economia/3/2019/2269481

 

Japan, China, dedollarizing

http://www.japanfocus.org/-Kosuke-TAKAHASHI/3769

 

I think you can see the advantage of having access to the multilingual press. Monolingualism is a bit of a hindrance these days if you want to know what is going on in the rest of the world that might just affect you. Especially if you are a subscriber to “specialized” news sites like Stratfor, Wall Street Journal or New York Times, that seem to have trouble reading any language.