Before we get to the article, consider the recent developments; China spat on Obama and forced him to come out of the back of Air force one; no red carpet treatment at all. Philippines president called him a “son of a whore” and even the dirty house of Saud king refused to meet with him. All this illustrates that Russia and China are moving to the top of the Food chain; this is particularly true for Russia. Putin is the one that started this resistance; if not for him, China would not have responded so aggressively.
The video illustrates how Obama was forced to come out of the as one of the Chinese put it “ass of the plane”, while Putin was given the royal treatment. China is sending a forceful message to Obama; they are telling the US that they are prepared to go to war over the South China Sea issue. America would be wise to heed this call. Experts have clearly shown that had American now tried to push China, they would not have taken such an aggressive stance and started building artificial islands.
Fasten your seatbelts; 2015 will be a whirlwind pitting China, Russia and Iran against what I have described as the Empire of Chaos.So yes – it will be all about further moves towards the integration of Eurasia as the US is progressively squeezed out of Eurasia. We will see a complex geostrategic interplay gradually undermining the hegemony of the US dollar as a reserve currency and, most of all, the petrodollar.
For all the immense challenges the Chinese face, all over Beijing it’s easy to detect unmistakable signs of a self-assured, self-confident, fully emerged commercial superpower. President Xi Jinping and the current leadership will keep investing heavily in the urbanisation drive and the fight against corruption, including at the highest levels of the Chinese Communist Party (CCP). Internationally, the Chinese will accelerate their overwhelming push for new ‘Silk Roads’ – both overland and maritime – which will underpin the long-term Chinese master strategy of unifying Eurasia with trade and commerce. Global oil prices are bound to remain low. All bets are off on whether a nuclear deal will be reached by this summer between Iran and the P5+1. If sanctions (actually economic war) against Iran remain and continue to severely hurt its economy, Tehran’s reaction will be firm, and will include even more integration with Asia, not the West. Full Story
Washington is well-aware that a comprehensive deal with Iran cannot be reached without Russia’s help. That would be the Obama administration’s sole – and I repeat – only foreign policy success. Return to the “Bomb Iran” hysteria would only suit the proverbial usual (neo-con) suspects. Still, by no accident, both Iran and Russia are now subject to Western sanctions. No matter how it was engineered, the current financial/strategic oil price collapse is a direct attack against (who else?) Iran and Russia.
That derivative war
Now let’s take a look at Russian fundamentals. Russia’s government debt totals only 13.4% of its GDP. Its budget deficit about GDP is only 0.5%. If we assume a US GDP of $16.8 trillion (the figure for 2013), the US budget deficit totals 4% of GDP, versus 0.5% for Russia. The Fed is essentially a private corporation owned by regional US private banks, although it passes itself off as a state institution. The US publicly held debt is equal to a whopping 74% of GDP in the fiscal year 2014. Russia’s is only 13.4%.
The declaration of economic war by the US and EU on Russia – via the run on the ruble and the derivative oil attack – was essentially a derivatives racket. Derivatives – in theory – may be multiplied to infinity. Derivative operators attacked both the ruble and oil prices to destroy the Russian economy. The problem is, the Russian economy is more soundly financed than America’s.
Considering that this swift move was conceived as a checkmate, Moscow’s defensive strategy was not that bad. On the key energy front, the problem remains the West’s – not Russia’s. If the EU does not buy what Gazprom has to offer, it will collapse. Moscow’s fundamental mistake was to allow Russia’s domestic industry to be financed by external, dollar-denominated debt. Talk about a monster debt trap which can be easily manipulated by the West. The first step for Moscow should be to closely supervise its banks. Russian companies should borrow domestically and move to sell their assets abroad. Moscow should also consider implementing a system of currency controls so the basic interest rate can be brought down quickly. Full Story
Another very interesting take on the situation; it’s certainly not an open and closed case like the USA and EU are making it look like.
Oil Wars Will End Up Killing Off US And Saudi Arabia, Not Russia
It appears that the US and Saudi Arabia, that is, the country that supports torture of prisoners and the country that beheads people for not obeying the strictest form of Muslim beliefs and stones women to death for infractions like say, driving a car, are attacking Russia which is a liberal, modern country that has rights for women and no religious persecution. The scheme is to flood the world markets with oil and then cause Putin to be unpopular and then see the Russian flounder and fail and fall apart like when they were led by the very unpopular communist party.
If this scheme is true, there are several facets to it which show me that it is a failure and will bite the Texans, Canadians, Dakota states and of course the Saudis, in the ass, big time. That is, PUTIN IS POPULAR. The Russians are no fools. They won’t blame Putin for all this; they will blame the EU and US. NATO has been extremely provocative in all this, menacing Russia. When a people are menaced militarily and are being butchered like the Russian speakers of Ukraine, the end result is, they pull together and fight back and I believe the consensus in Russia will be to make Putin stronger, not weaker since Russia is now under attack at every level especially the banking levels. Ah, banks! The US and EU just saw a near total banking collapse recently which was literally papered over by using ZIRP loans from central banks which means ‘print money like mad’. The only thing keeping this wretched banking mess rolling is world trade. Since China has an interest in keeping both the euro and dollar strong, the bank bailout ‘worked’ in that China bought a tremendous amount of US and EU debts and used this to keep pouring in exports as China madly builds up its domestic economy which is now the biggest on earth. Lest Americans forget: we are no longer the biggest economy on earth. Full Story
The Saudi’s are playing with fire, this time, they are fighting some weak nation like Iraq or Libya, or even Iran; this time, it’s Russia in the picture, a country that could easily bomb them to oblivion or arm the Houthis to make their lives miserable. They are already having a tough time dealing with the Houthis so an armed Houthi operation could be a real problem for the House of Saud. China is also siding with Russia, as is Iran so the Saudis cannot count on U.S support indefinitely. In the end, the House of Saud will live to regret its decision of joining forces with the U.S
