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Putin Leads BRICS Uprising
Putin Leads BRICS Uprising
There’s been a virtual blackout of news from this year’s seventh annual BRICS summit in Ufa, Russia. None of the mainstream media organizations are covering the meetings or making any attempt to explain what’s going on. As a result, the American people remain largely in the dark about a powerful coalition of nations that are putting in place an alternate system that will greatly reduce US influence in the world and end the current era of superpower rule.
Let’s cut to the chase: Leaders of the BRICS (Brazil, Russia, India, China and South Africa) realize that global security cannot be entrusted to a country that sees war as a acceptable means for achieving its geopolitical objectives. They also realize that they won’t be able to achieve financial stability as long as Washington dictates the rules, issues the de facto “international” currency, and controls the main levers of global financial power. This is why the BRICS have decided to chart a different course, to gradually break free from the existing Bretton Woods system, and to create parallel system that better serves their own interests. Logically, they have focused on the foundation blocks which support the current US-led system, that is, the institutions from which the United States derives its extraordinary power; the dollar, the US Treasury market, and the IMF. Replace these, the thinking goes, and the indispensable nation becomes just another country struggling to get by. This is from the Asia Times:
“Leaders of the BRICS… launched the New Development Bank, which has taken three years of negotiations to bring to fruition. With about $50 billion in starting capital, the bank is expected to start issuing debt to fund infrastructure projects next year. They also launched a foreign-exchange currency fund of $100 billion.
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China and the Gold Bugs
China and the Gold Bugs
A Popular Myth
One of the most persistent story lines among gold bugs and market participants who foresee the collapse of the dollar goes something like this:
China and many emerging markets including the other BRICS are looking for a way out of the global fiat currency system. That system is dominated today by the U.S. dollar. This dollar dominance allows the U.S. to force certain kinds of behavior in foreign policy and energy markets.
Countries that don’t comply with U.S. wishes find themselves frozen out of global payment systems and find their banks unable to transact in dollars for needed imports or to get paid for their exports. Russia, Iran, and Syria have all been subjected to this treatment recently.
China does not like this system any more than Russia or Iran but is unwilling to confront the U.S. Head-on. Instead, China is quietly accumulating massive amounts of gold and building alternative financial institutions such as the Asia Infrastructure Investment Bank, AIIB, and the BRICS-sponsored New Development Bank, NDB.
When the time is right, China will suddenly announce its actual gold holdings to the world and simultaneously turn its back on the Bretton Woods institutions such as the IMF and World Bank. China will back its currency with its own gold and use the AIIB and NDB and other institutions to lead a new global financial order.
Russia and others will be invited to join the Chinese in this new international monetary system. As a result, the dollar will collapse, the price of gold will skyrocket, and China will be the new global financial hegemon. The gold bugs will live happily ever after. The only problem with this story is that the most important parts of it are wrong.
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