Russia and China Threaten to Destroy the Almighty Dollar
Russia Threatens to Drop The Dollar and Crash The U.S. Economy if Sanctions Are Imposed – Obama Signs Sanctions Anyway
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Is Russia bluffing, or is the world as we know it about to change for ever?
On Tuesday Reuters reported that a Kremlin aid Sergei Glazyev had announced that if the U.S. were to impose sanctions on Russia Moscow may drop the dollar as a reserve currency and refuse to pay off any loans to U.S. banks saying that Moscow could recommend that all holders of U.S. treasuries sell them if Washington freezes the U.S. accounts of Russian businesses and individuals.
“We would find a way not just to reduce our dependency on the United States to zero but to emerge from those sanctions with great benefits for ourselves,” said Glazyev.
“An attempt to announce sanctions would end in a crash for the financial system of the United States, which would cause the end of the domination of the United States in the global financial system”
That statement is startling by itself, but the true gravity of this situation is only evident when you consider it in context. China has taken Russia’s side in the Ukraine conflict (they are after all allies) and China holds the lion’s share of U.S. treasuries. If Russia puts out the call to drop the dollar China would have a choice: either hold on to those treasuries while the dollar slides (losing their shirt in the process) or join Russia and dump their holdings as well. It should be pretty obvious which way China would go.
The effects of a coordinated bond sell off by China and Russia would be earth shattering. This would be the financial equivalent of a nuclear bomb being dropped. It is no exaggeration to say that such a move would mark the end of an era.
You would think that this would prompt some serious reflection and that diplomats would be scrambling to resolve this peacefully, but instead today Obama signed a sanction order anyway and revoked the visas of a number of Russian officials. All of this supposedly in response to the violence in Kiev even though we now have leaked phone conversations that indicate that it was in fact the new coalition government in Ukraine that was responsible for the shootings and that the West knows this. Combine this with the fact that several U.S. officials met directly with known Neo-Nazi leaders prior to the coup in Ukraine and these sanctions are even more non-nonsensical.
Russia warns it could ‘crash’ U.S. economy if sanctions enacted over Ukraine crisis
Russia could reduce to zero its economic dependency on the United States if Washington agreed sanctions against Moscow over Ukraine, a Kremlin aide said on Tuesday, warning that the American financial system faced a “crash” if this happened.
“We would find a way not just to reduce our dependency on the United States to zero but to emerge from those sanctions with great benefits for ourselves,” said Kremlin economic aide Sergei Glazyev, saying Russia could stop using dollars for international transactions.
“An attempt to announce sanctions would end in a crash for the financial system of the United States, which would cause the end of the domination of the United States in the global financial system,” he added.
The Extreme Right Emerging as the Dominant Voice in Ukraine
The extreme right in the Ukraine played a key role in the toppling Victor Yanukovich, and they are already emerging as the most forceful voice in the transition.
On February 25th The Guardian ran a story on the increasing tensions over the Crimean peninsula and the danger posed by separatist elements in Ukraine. Part of that article covers the recent vote by the Ukrainian parliament to send former president Viktor Yanukovych to The Hague. The spokesman that they quoted on the issue was Oleh Oleh Tiahnybok, leader of the Svoboda party, an extreme right group which has openly targeted Jews.
Oleh Tiahnybok, leader of the nationalist Svoboda party, said: “It is very important that we had a positive vote today. Now we are inviting all the people of goodwill who have any materials including video, photos or papers that we may need to properly submit to the Hague tribunal the papers about crimes against people, crimes against Ukrainians, and violations of human rights that were committed by those criminals in Yanukovych’s regime.”
To put this in perspective, in 2005 Oleh Tiahnybok signed an open letter to Ukrainian leaders, calling for the government to halt the “criminal activities” of “organised Jewry”. The fact that this man is the go-to man for questions concerning the criminal charges against the former president of the Ukraine should tell you something.
Related: Ukrainian War: Russian Council Unanimously Approves Military Deployment – Seizes Two Airports
In this context the Ukrainian parliament’s decision this week to rescind the status of Russian as a second official language in the Ukraine takes on a new meaning. Such a provocative move makes no sense strategically. It is stirring up tensions in Crimea, alienating much of the population in Eastern Ukraine where much of the population speaks Russian as their first language, and it is has prompted Russia to publicly state that it will act militarily if the Russian population is threatened in Ukraine. Not a smart move on any level, but perfectly aligned with the ideology of Svoboda.
In the power vacuum left by the fall of the Ukrainian government the various groups who participated in the protests are now competing for control of the narrative and so far the extreme right seems to be dominant. The calls for loans that the the pro-NATO contingent have made are weak and indecisive in comparison to the moves being made by Tiahnybok and his followers. This doesn’t bode well for the hopes of a peaceful and stable transition for the country.
Related: Washington’s Role in the Ukrainian Coup & How it May Spin Out of Control
If the extreme right is controlling the dialogue, then the proposed loans from the U.S. the E.U. and the I.M.F. will only make the situation worse. The West has already made it clear that those loans will require structural adjustments (read austerity measures). Looking at Greece we can see how these policies facilitated the rise of the Golden Dawn (a neo-Nazi group). In Greece there was a standing government which has taken action to contain the movement (by arresting its leaders), but in the Ukraine an entirely different can of worms just got opened up. There is no established government to act decisively to prevent the rise of these elements, and IMF austerity measures will just throw gasoline on the fire.
Has this been the plan of Obama from the start? Designed, developed and brought to fruition. He has done his utmost to destroy our economy, our nations manufacturing and our dollar. He is well on his way to success and many just sit back and allow it to happen. IMO we don’t need lawyers and judges and dual citizens in our government. There is nothing wrong with the Government design, there is everything wrong with those in the Government. Our forefathers have the designs that are full proof, the problem is keeping the rats out of the kitchen. We need to get the exterminator in to clear the rats off the cutlery.