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The Road to 2025 (Part 2) – Russia and China Have Had Enough

The Road to 2025 (Part 2) – Russia and China Have Had Enough

Part 1 of this series focused on how the U.S. empire no longer provides any real benefit to the average American citizen. Rather, the spoils of overseas wars, the domestic surveillance state and an overall corrupt economy are being systematically funneled to a smaller and smaller group of generally unsavory characters. The public’s starting to recognize this reality, which is why we saw major populist movements emerge on both the traditional right and left of the political spectrum in 2016.

As millions of Americans emerge from their long slumber, much of the world’s been aware of this reality for a long time. They don’t see the U.S. as a magnanimous humanitarian empire, that’s a fairytale more suited for children’s books and the mass media. In fact, it seems clear that the billions of humans who live in various sovereign nations around the world would certainly prefer to be in control of their own destinies as opposed to mere vassal states of the U.S., they simply haven’t possessed the military or economic power to stand up and chart their own course. But things are changing.

The most significant geopolitical change of the 21st century is the emergence of China, and the reemergence of Russia, as globally significant military powers. This is the core driver behind the establishment’s panic about Russia. It has nothing to do with Putin’s authoritarianism or human rights abuses, that’s just marketing directed at a heretofore extremely gullible public.

In reality, those determined to perpetuate a unipolar world run by the U.S. are appalled and concerned about the fact Russia was able to become involved in Syria and prevent another regime change operation. Russia very publicly, and very successfully, stood up and said “no” to U.S. imperial ambitions in Syria. This isn’t just historically significant, it’s seen as blasphemous and recalcitrant by the U.S. status quo.

…click on the above link to read the rest of the article…

China Prepares “Emergency Response Plan” Amid Escalating US Trade War

While in recent days the growing trade war between China and the US has moved off the front page of market concerns despite now daily skirmishes such as today’s anti-dumping probe launch by the US into US steel wheels which followed a Chinese 179% tariff on US sorghum imports which in turn was in response to the US banning exports to Chinese telecom giant ZTE, in recent days China has drawn up comprehensive list of urgent measures as the war of words over US-China trade relations has threatened to escalate into open economic conflict with each side threatening to levy heavy tariffs and taxes on each other’s imports.

Commenting on the recent trade hostilities, National Development and Reform Commission spokesman Zeng Peiyan said on Wednesday that Beijing has all the political instruments it needs to respond to this trade conflict with the United States and minimize its economic effect.

“We have an emergency response plan at various levels and political means to retaliate to the trade challenges, initiated by the United States,” Zeng added.

He stressed that the trade conflict would affect the country’s economy only partially and that China “has the confidence, potential and ability to ensure the stable functioning of the country’s economy.”

Meanwhile, according to Reuters, Beijing’s international trade representatives have held multiple meetings with their counterparts in leading European economies as China, too, seek support in its trade brawl with the US. Recall the US was supposed to do the same with Trump canvassing support for the growing world trade war in Latin America last week, however he was held back by the diversionary Syrian airstikes.

China however, was not detained and Beijing officials met ambassadors from France, Germany, the United Kingdom, Spain and Italy last Thursday and Friday to propose a firewall against Trump’s protectionism, Reuters reported.

…click on the above link to read the rest of the article…

China’s “Nuclear Option” in the Trade War

china trade war usa nuclear

China’s “Nuclear Option” in the Trade War

The United States has been interested in economic relations with China since 1784, shortly after the American War for Independence.

At first, this interest was purely economic, because the British refused to deal with the U.S. (for obvious reasons). So the Americans bought Chinese goods, and the Chinese bought from the Americans.

And for most of U.S. history, things were good. But in 1949, with the rise of Mao and communist China, tensions rose.

Fast-forward to today’s relationship, as described by The Heritage Foundation:

Today, the United States and the People’s Republic of China are like the European great powers of a century ago. They trade with each other, but do not trust each other. They have the largest economies in the world, and they have a financial and trading relationship that shapes the global economy. But at the same time, they have different, and often opposing, views on many national security and foreign policy issues.

This lack of trust in their trading relationship mainly stems from China’s views on communism, their endorsement of certain people, and security issues.

Now it looks like that trading relationship is heating up dramatically…

China recently announced tariffs on 106 U.S. products like soy, cars, and some chemicals. As Sam Meredith explains on CNBC.com, this came 24 hours after the U.S. slapped tariffs on a list of Chinese imports in a $50 billion crackdown on unfair trade practices:

The effective start date for the new charges is not announced, though China’s Ministry of Commerce says the tariffs are designed to target up to $50 billion of U.S. products annually. The 25 percent levy on U.S. imports includes products such as soybeans, cars and whiskey.

This announcement caused a 450-point drop in the Dow Jones.

In retaliation, the Trump Administration then doubled down on its initial tariffs, imposing another $100 billion in tariffs on Chinese goods.

…click on the above link to read the rest of the article…

Is the “Petro-Yuan” a Credible Challenge to Dollar Supremacy?

Is the “Petro-Yuan” a Credible Challenge to Dollar Supremacy?

Wolf Richter with Jim Goddard on This Week in Money:

China latest effort to get its currency to be used globally is the “petro-yuan.” Is it a credible challenge to the supremacy of the US dollar? If China dumped US Treasuries, what would that accomplish? And more…

Central banks around the world seem leery about the Chinese yuan. Read…  What Could Dethrone the Dollar as Top Reserve Currency?

Four Flashpoints of Volatility

Four Flashpoints of Volatility

1 – Trade Wars Flashpoints, From China to Canada and Mexico

Wall Street has knee-jerk reactions to any trade war related headlines.

There are legitimate reasons to be concerned about trade wars. The world is increasingly more connected than ever. Many major American companies that are household names such as Starbucks (SBUX), Boeing (BA) and Apple (AAPL) rely on their exports (and imports) from China for a sizable portion of their overall sales and profits.

If China continues to retaliate against trade war policies from the U.S. with harsh measures of their own, it could hurt revenues of those firms.

But, here’s the latest revelation:

China wants to keep more of what it makes — in China — across a variety of sectors. Trade wars elevate the Chinese government’s desire to do that. The country has just recently launched a new $1.6 billion initiative called “Made in China 2025.”

The strategy entails an increase in research and development spending. That would cause Chinese companies to rely less on international technology and equipment. The more China buys internally, the less it will buy American products or need to export to the U.S.

What all of that could mean is that similar products in the U.S will become more expensive for consumers. That would hit directly at stock of those companies, making them more volatile.

While headlines from the White House continue to target China, our regional trading partners are undoubtedly some of the most important, and currently some of the most fragile.

To the north, Canada is playing up its optimism over NAFTA talks. Rhetoric is one thing, reality is another. It’s important to look at what institutions are doing, not what they’re saying.

Canada is currently enhancing its participation in several other trade agreements, including an updated Trans-Pacific Partnership that does not include the U.S. In the wake of Brexit, Canada has also made important trade links to both Europe and the U.K.

…click on the above link to read the rest of the article…

China: “The Arrogant US Has A Record Of Launching Wars On Deceptive Grounds”

While the lack of retaliation by Russia to Trump’s Friday night Syrian airstrikes surprised some, Russia defended its stance of shrugging in response (and not escalating to full blown world war), by asserting that Soviet-made missiles intercepted more than half of the 105 cruise missiles fired at three Syrian facilities (the Pentagon denied any missiles were hit), and that the US, UK and French blitz was generally less aggressive than most had feared, perhaps thanks to extensive advance warnings by Trump that an attack was imminent.

Yet if Russia’s managed response is understandable, one country whose vocal outcry to US strikes has been a surprise, is China.

As we reported yesterday, China was the first superpower outside those directly involved to slam the US airstrikes: “Any unilateral military action violates the United Nations charter and its principles and international law and its principles. [The strikes] are also going to add more factors to complicate the resolution of the Syrian crisis,” Chinese foreign ministry spokeswoman Hua Chunying said in a statement on Saturday afternoon.

Beijing also called for an investigation into claims of a Syrian poison gas attack on the rebel-held town of Douma that rescuers and monitors say killed more than 40 people, and prompted the Western action: “The Chinese side believes a comprehensive, impartial and objective investigation should be conducted into the suspected chemical attacks and it should come up with reliable conclusions … Before this, no conclusion by any side should be made,” Hua said.

* * *

Then, on Saturday during the emergency session of the Security Council on Saturday, Russia proposed a resolution urging the US and its allies to “immediately and without delay cease the aggression against the Syrian Arab Republic and refrain from further aggressive acts in violation of the international law and the UN Charter.”

…click on the above link to read the rest of the article…

China Slams Syrian Airstrikes As Germany And Italy Refuse To Participate

While the western community has been broadly supportive of the overnight strikes launched against Syria by the US, UK and France, two prominent members have either refused to participate or outright oppose them.

As we first reported last week, Germany (along with Italy) refused to be an active member of the strikes. On Saturday morning, Germany’s Foreign Minister Heiko Maas said the country won’t participate in military actions against Syria, according to an interview in news magazine Spiegel.

This is not the role that we – in coordination with our partners – want to play in this conflict.” Although, he added that he understands the view of French President Emmanuel Macron, who said use of chemical weapons “crosses a line” and added that “The use of chemical weapons must stop and can’t be without consequences.”

Angela Merkel was similarly supportive: “We support that our American, British and French allies, as permanent members of the UN Security Council, have taken responsibility in this way,” the Chancellor said in statement… just not enough to take part in the strikes that she knew would prompt a response from Putin.

Italy also rushed to made it clear to the Kremlin it was not an active participant: Italian Prime Minister Paolo Gentiloni said in a televised address that the reaction to alleged chemical weapons attacks in Syria was measured, and should not mark the beginning of escalation in the region. He then added that while Italy is an ally of the participants, the country didn’t participate; and while Italy usually gives logistical help, in this case Italy did not provide.

Perhaps the reason for this reticence is that the two nations most reliant on Russian nat gas imports, realized that they don’t want to be especially cold this coming winter.

…click on the above link to read the rest of the article…

The US Fading into Irrelevance – A Good Thing for the World

The US Fading into Irrelevance – A Good Thing for the World

The US Fading into Irrelevance – A Good Thing for the World

Chaos reigns in the United States, spreading to its closest allies. The war amongst Western elites is in full swing, manifesting itself from commercial wars to failed diplomacy, empty threats of war, corruption, and announced military withdrawals and attacks.

To sum up the last few weeks of international events, it is worth comparing the direction taken by the multipolar troika of Russia, China and Iran, and the one taken by the fading unipolar order led by the United States, Israel and Saudi Arabia.

We can analyze the respective changes taking place within the unipolar and multipolar camps, especially in the economic, commercial, diplomatic and military fields. The introduction by the US of duties on imports, applied to 1,300 products, including iron and aluminum, has triggered a chain of events, including the imposition of as many duties on various products exported by the US to China. The pressure on America’s European allies continues, against the protests of France and Germany. It seems that Europe is struggling to form a common front on many issues relating from foreign policy to trade. The Western elites continue its in-fighting, between the European Union (led by Berlin and Paris) and the UK and the US, clashing over agreements between London and Brussels and Washington and Brussels. The Trump tariff war aims to deliver a blow to America’s opponents, but it risks provoking strong responses, even from allies. Moreover, many analysts and economists have warned that this form of commercial warfare risks harming American workers the most.

…click on the above link to read the rest of the article…

Hot War and Cold Markets

This is turning into a comedy. A black comedy, for sure, but still. As both the Skripal novichok ‘poisoning’ case in Britain and the ‘chemical attack’ in Douma, Syria fall flat on their faces on a total and absolute lack of evidence, it’s becoming clear that western ‘authorities’ are not at all planning to let go of the privilege that in times gone by allowed them to claim whatever they wanted and demand to be believed.

And despite the insane amounts of spying that underlies their business models and will lead to their demise(s), here is where social media do play a decisive role. See, if you’re an ‘authority’, there’s nothing you would rather do than to close down those social media that let people spread news that contradicts and/or doubts what you just said, and undermines that privilege. But that also would mean you can’t spy on them anymore through social media. A toss-up?!

Whatever the outcome will be, it’s obvious that Donald Trump is having war talks with his military and closest advisers. And they can basically tell him anything, he’s not a military man. Which is fine, Lincoln wasn’t either. But it does mean he’s vulnerable to narratives and briefings that are simply not true. Lincoln went to great lengths to surround himself with people who could trust.

What about Trump? Does he know that, as Paul Craig Roberts said on Twitter yesterday ..

The Russians know that they can, at will within a few minutes, sink the entire US fleet, destroy every US airplane & ship in the ME & within range of the ME, completely destroy all of Israel’s military capability & wipe out the military of the two-bit punk state of Saudi Arabia.

…click on the above link to read the rest of the article…

It’s Pure Math – We’re Headed for a Train Wreck – Bill Holter

It’s Pure Math – We’re Headed for a Train Wreck – Bill Holter

Financial writer and gold expert Bill Holter says China has a lot of weapons to fight a trade war with the U.S. China could stop buying Treasury bonds (as it reportedly already has done).  It could sell Treasury bonds.  It could slash the value of the Yuan, or something much simpler could happen such as a failed delivery of physical precious metals.  Holter says, “If what has happened so far in the first three months of the year were to continue for the full year, you would be over three billion ounces (of silver).  That is not deliverable.”What happen when the world figures out that three billion ounces of physical silver cannot and will not be delivered to the buyers? Holter explains, “That’s called an old fashion run on the banks.  It will be a run on the entire system.  You would have a run on every metals exchange, and you would probably have runs on many physical commodities.  Confidence throughout the whole system would break.  You would basically show the western fractional reserve system is a fraud and has been for many, many years. . . . Can London deliver a billion ounces, or two billion ounces or three billion ounces of silver?  The answer to that is no.”

So, when does this all blow up? Holter says, “I think this whole thing has a very good chance of blowing this year.”

There are a variety of financial trip wires, according to Bill Holter, such as thousands of sealed criminal indictments that will be unsealed in 2018. Holter also points out the explosion of global debt.  Holter charges, “It’s now $237 trillion.  The amount of debt grew by $21 trillion globally over the last 12 months. That’s roughly 10 %.  How much did global GDP grow?   2% or 3%, I mean that is totally unsustainable.”

…click on the above link to read the rest of the article…

The Harder the Winds of War Blow, the More they Suck.

The Harder the Winds of War Blow, the More they Suck.

In Vietnam, the wind doesn’t blow… it sucks.

— Tag Line for Stanley Kubrick’s “Full Metal Jacket”

When I wrote a few weeks ago that I thought the Neocons were making the full-court press for war I thought President Trump was a reluctant player in the game.

Part of me still believes that.

Part of me also believes that Trump, like everyone else, is a slave to his passions and is easily manipulated into terrible decisions.  Case in point was last year’s bombing of the Al Shairat airbase in Syria after a similar false flag chemical weapons attack at Khan Sheikoun.

Will he fall victim to them again this year?  According to him, we’ll know soon.  Meanwhile a carrier group has been dispatched to the Eastern Mediterranean.  Chinese missile frigates are there supporting Russian vessels and the destroyer U.S.S. Donald Cook is now just off the coats of the Russian base at Tartus.

The circumstances are exactly the same as last year.  The pro-Assad coalition is winning, having made short work of the ‘rebels’ in Eastern Ghouta.  And now we are to believe they are so stupid as to gas women and children after Trump’s big light show last year?

New Russian sanctions were unveiled on Friday.  A new alleged chlorine attack on Saturday.  The Israelis lobbing missiles on Sunday.  Russian markets melt down on Monday before Special Counsel Robert Mueller orders an FBI raid of Trump’s lawyer, Steven Cohen.

This isn’t just a full-court press for war.  It is the push for a Faustian bargain with the most evil people on the planet.

The political establishment across the West is reminding us all the price of opposition to perpetual war for perpetual serfdom.  The people of Russia spoke loudly three weeks ago.

Defy the West however you have to Mr. Putin.  It’s obvious Mr. Trump isn’t up to the job.

…click on the above link to read the rest of the article…

China Eyes Yuan Devaluation in Trade Dispute

Finally, we have a story that makes retaliatory sense vs. the widely believed “nuclear” treasury dumping theory.

The widely-circulated “nuclear” theory suggests China would dump US treasuries in a trade war with the US. That theory never made any sense. Such a move would tend to strengthen the yuan, making Chinese exports more expensive. Thus, it would be precisely what the US would want.

The Real Nuclear Option

The real nuclear option would be a devaluation of the yuan, making Chinese goods less expensive to the US.

China is evaluating the potential impact of a gradual yuan depreciation, people familiar with the matter said, as the country’s leaders weigh their options in a trade spat with U.S. President Donald Trump that has roiled financial markets worldwide.

Senior Chinese officials are studying a two-pronged analysis of the yuan that was prepared by the government, the people said. One part looks at the effect of using the currency as a tool in trade negotiations with the U.S., while a second part examines what would happen if China devalues the yuan to offset the impact of any trade deal that curbs exports.

While a weaker yuan could help President Xi Jinping shore up China’s export industries in the event of widespread tariffs in the U.S., a devaluation comes with plenty of risks. It would encourage Trump to follow through on his threat to brand China a currency manipulator, make it more difficult for Chinese companies to service their mountain of offshore debt, and undermine recent efforts by the government to move toward a more market-oriented exchange rate system.

It would also expose China to the risk of heightened financial-market volatility, something authorities have worked hard to avoid in recent years. When China unexpectedly devalued the yuan by about 2 percent in August 2015, the move fueled capital outflows and sent shock-waves through global markets.

…click on the above link to read the rest of the article…

Petro-yuan is the newest weapon for the China-Russia-Iran anti-USD alliance

Petro-yuan is the newest weapon for the China-Russia-Iran anti-USD alliance

Pictured above, the currency symbols for the old Spanish peseta and the Chinese yuan. Maybe Baba Beijing can synthesize the two of them into a cooling looking petro-yuan logo.

After 25 years of dreams, planning, rumors and testing, the Chinese petro-yuan is now official. Right now, almost all global oil trade is conducted in US dollars, using two benchmark varieties of crude, West Texas Intermediate and North Sea Brent, as the industry standards. It is no accident that these two benchmarks are based on imperial crude, American and British, and the irony of this is surely not lost on Baba Beijing (China’s leadership).

China is not selling oil, so the petro-yuan is a futures purchase contract denominated in renminbi for the country to import the stuff. As the world’s biggest importer of hydrocarbons, Baba Beijing has long felt that pricing all its millions of tons of imports should be in its national currency. Why should China pay for Russian natural gas or Venezuelan crude in Western empire’s currency of global financial control, Uncle Sam’s greenback?

Opinions outside China range from being non-plussed, to claiming it is the most important news in modern financial history, but you would have to search far and wide in Eurangloland (NATO, EU, Israel, Australia and New Zealand) and its heavily censored and suppressed media, to see for yourself. Outside the obligatory statement of fact in financial outlets like the Wall Street Journal, Financial Times, Reuters and Bloomberg, silence from the West’s mainstream media is deafening, as this screenshot below shows, when searching the topic. Only one mainstream article showed up on page #1 of the web search and that was CNBC from 2017. Even just looking for “petro-yuan” gives identical results. It’s a Western media black hole.

…click on the above link to read the rest of the article…

“We Understand The Chinese Government Has Halted Purchases Of US Treasuries”: SGH

On Friday, we reported that among the five “nuclear” options available to Beijing to retaliate against Trump’s latest $100BN in import tariffs, was the choice whether or not to sell US Treasuries. But what if Beijing did not want to unleash a full-blown market nuke, and instead was hoping for a targeted, EMP hit?

Then it would simply stop buying US paper, instead of dumping it outright; in the process it wouldn’t hurt the US too much – avoiding an angry response –  but it would send a clear signal to the White House, whose fiscal spending plan will more than double net Treasury issuance this year from under $500BN to over $1 trillion, and which needs every possible marginal buyer of US paper, both domestic and foreign.

Which is precisely what a new report by SGH Macro Advisors claims.

According to the consultancy, a long-time favorite of macro hedge funds, Beijing has twice threatened deliberately targeted tit-for-tat punitive measures against the US to date: “first, in response to the Trump Administration’s threat of steel and aluminum tariffs, and second, in response to broader measures aimed at $50 billion of products that lie directly at the heart of Chinese technology transfers, intellectual property violations, and strategic, “Made in China 2025” plan.

But even as US cabinet officials lined up yesterday to calm jittery equity markets, SGH says in a note released over the weekend that “China had already signaled an aggressive and potentially more ominous escalation in the developing trade wars to the White House”:

From what we understand, the Chinese government has halted its purchases of US Treasuries. Despite the direct encouragement, according to Chinese sources, by US Treasury Secretary Steve Mnuchin for China to “stay put,” Beijing has apparently discontinued purchases of US Treasuries “for the past few weeks.”

Some more details from the note:

…click on the above link to read the rest of the article…

Trump’s Dangerous Game of Chicken

Trump’s Dangerous Game of Chicken

As the “tit-for-tat” trade fight between the US and China escalates, Donald Trump is likely to find that he doesn’t “know China” the way he once thought. When he said that during the presidential campaign, he based his understanding of China on one thing: the high rent in Trump Tower that he had exacted from a Chinese bank. Today, he may still assume he can win a game of chicken by upping the ante until the Chinese eventually fold.

But Trump and his crew don’t understand Chinese thinking. The Chinese leadership does not respond well to being bullied, least of all now that they have a means of fighting back. China’s commerce ministry said as much in a statement right out of Chairman Mao’s playbook. Mao had often said when dealing with “US imperialism”: “We will not attack unless we are attacked,” Mao often said. “But if we are attacked, we will certainly counterattack.” A ministry spokesman said today (April 6): “The Chinese way of doing things is like this: We do not pick a fight, but if someone does pick a fight, we will fight resolutely. The Chinese have always been very serious in handling these matters. We mean what we say.” And the commerce ministry added in a formal statement: “On the issue of Sino-US trade, the Chinese position has been made very clear. We do not want to fight, but we are not afraid to fight a trade war.”

Trump and other US officials are saying the US isn’t engaged in a trade war with China. But China’s press is already using that term. Perhaps there won’t be a trade war; Trump may simply be employing his usual bluster to force more favorable terms of trade. He risks stepping over the line, however.

…click on the above link to read the rest of the article…

Olduvai II: Exodus
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Olduvai
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Olduvai II: Exodus
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Olduvai III: Cataclysm
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