Wednesday, August 08, 2007

Financial Armageddon or, "Hey mister, have you got $4375.00 to spare for a cup of coffee?"

posted by Bill Arnett @ 11:39 AM Permalink

Scenario: America has begun and remains embroiled in a horrific, genocidal war with the Iraqis in order to steal their oil. Profit Sharing Agreements, written in Washington, D.C. prior to commencing this illegal war mark the greatest attempted theft of another country's natural resources in world history. Under these agreements, which have cost us dearly to try and get signed, 85%-87% of Iraqi oil profits for the next thirty years will go to Big Oil. Already America is beginning to make deals for the sale of vast quantities of oil to Israel by promising to ship it by pipe, through Jordan to Haifa's refineries. We are spending $5,000.00 per second, borrowed money all, in our attempt to divvy up that which is not ours. America is borrowing the five thousand dollars a second from our newest bankers, the Red Chinese Communist government, which has been only too glad to finance the debacle in which we find ourselves, while their government quietly circles the globe buying up every oil contract it can find for sale at a cost of pennies on the dollar compared to what America is spending squandering lives, devastating countries, killing hundreds of thousands of Iraqis, breaking our military, and bankrupting the Treasury the Chinese are all too willing to keep full for us.

America has been living on borrowed money and borrowed time as we once again begin saber-rattling, blowing smoke, and making utterly puerile threats to start imposing sanctions against our bankers. Well, bankers can strike back, too.

See this article from the
Two officials at leading Communist Party bodies have given interviews in recent days warning - for the first time - that Beijing may use its $1.33 trillion (£658bn) of foreign reserves as a political weapon to counter pressure from the US Congress.[…]

Described as China's "nuclear option" in the state media, such action could trigger a dollar crash at a time when the US currency is already breaking down through historic support levels.

It would also cause a spike in US bond yields, hammering the US housing market and perhaps tipping the economy into recession. It is estimated that China holds over $900bn in a mix of US bonds.

Xia Bin, finance chief at the Development Research Centre (which has cabinet rank), kicked off what now appears to be government policy with a comment last week that Beijing's foreign reserves should be used as a "bargaining chip" in talks with the US.

"Of course, China doesn't want any undesirable phenomenon in the global financial order," he added.

He Fan, an official at the Chinese Academy of Social Sciences, went even further today, letting it be known that Beijing had the power to set off a dollar collapse if it choose to do so.

"China has accumulated a large sum of US dollars. Such a big sum, of which a considerable portion is in US treasury bonds, contributes a great deal to maintaining the position of the dollar as a reserve currency. Russia, Switzerland, and several other countries have reduced the their dollar holdings.[…]

The threats play into the presidential electoral campaign of Hillary Clinton, who has called for restrictive legislation to prevent America being "held hostage to economic decicions being made in Beijing, Shanghai, or Tokyo".

She said foreign control over 44pc of the US national debt had left America acutely vulnerable.[…]

"The words are alarming and unambiguous. This carries a clear political threat and could have very serious consequences at a time when the credit markets are already afraid of contagion from the subprime troubles," he said.

A bill drafted by a group of US senators, and backed by the Senate Finance Committee, calls for trade tariffs against Chinese goods as retaliation for alleged currency manipulation.[…]

Henry Paulson, the US Tresury Secretary, said any such sanctions would undermine American authority and "could trigger a global cycle of protectionist legislation".
Could it be any more obvious that bush's "war on terra" has exposed America to more existential threats than any terrorist group possibly could?

The Chinese "nuclear option", if exercised, would instantly bankrupt us, cause blockbuster inflation at a breakneck pace, reduce the value of the dollar to about 20¢, and cause every other major holder of the dollar to push a massive selloff of dollars guaranteed to break us.

Imagine $25 flip-flops, $30 T-shirts (a 2-pk, of course), a $180,000.00 Toyota Prius, and $10-$15 for a gallon of gas.

Can't happen? All too sadly it can, and will happen if bush keeps up his imperial ambitions to conquer all the oil-rich nations to steal the oil we could have bought for much less than what we have spent in blood and treasure just to avoid doing the honest thing and buying the damned oil we need.

bush/cheney, the 108th and 109th Rubberstamping Congress, and the willingness of them all to sell off American assets and spend trillions every year we do not have has placed America in far greater danger from the enemies within than from without.

We are not safer.
9/11 happened on bush's watch.
bush has spent more money, in collaboration with his congressional sycophants, than all previous presidents combined.
His criminal attempt to commit genocide in Iraq to steal their oil jeopardizes us all.
The instant we go after any Chinese-controlled oil fields the free ride will stop and all markers will be called in.
The financial collapse of the government will lead to martial law and more frantic attempts to steal what America needs because we will not be able to afford to buy whatever that may be.
Then America will be no more, as every prior principle that guided America has been corrupted and twisted-in-a-sick-way by bush and the Republicans, with the assistance of the spineless, cowardly mice we have in congress that are called democrats.

After all, it wasn't until Saddam started demanding payment for his oil in a "more stable currency" like the euro that it suddenly became urgently necessary to attack and destroy him.

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At 5:00 PM, Blogger Cookie Jill said...

We certainly aren't safer.
The 1600 Crew are the real terrorists.

On an aside note, might be nice to have some National Guard helping fight our "little" fire here. Might be nice to see a little tax increase on multi-millionaires to help pay for the unexpected $54+ million dollars the Zaca Fire has cost thus far.

At 4:10 AM, Anonymous Anonymous said...

The United States, whether deliberately or inadvertently,has committed national suicide through its economic and financial policies during the past thirty to forty years. This is set out clearly and comprehensively in "America's Suicidal Statecraft: The Self-destruction of a Superpower" by a former Australian Ambassador, Dr James Cumes. The book is currently available through Amazon. In that book, he reminds us that "Civilisations die by suicide, not from Murder." The American people, or those who have looted their heritage, have sacrificed their unrivalled capacity for production, innovation and imaginative living on the altar of the quest for a fast buck and immersion in speculative fever. They can recover only by a return to the economic, financial and social behaviour that originally led them to be the most pragmatic, the most innovative and, in all its forms, the most powerful civilisation ever known.

At 10:43 AM, Anonymous Bill Arnett said...

Thanks for your thoughts. Both of you make some very good points.

This fire season will indeed be worse thanks to global warming effects, a lack of Nat. Guardsmen, and their equipment to fight them. We will once again get to see the famous bush response to disasters: nothing.

And anonymous is exactly right when s/he says that unless we return to our manufacturing roots we will continue to fail as a country. We have no more steel mills, textile plants, or the skilled people needed to make them run now that we have exported both the jobs and the industries.

In WWII America produced three Liberty ships, 20,000 jeeps, 30,000 trucks, and countless guns and the ammo for them a day. Now we can't even produce more than 90 armored vehicles a MONTH.

Tissue-thin paper tiger. that's America.


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