The tit for tat between China and the U.S.

When the economy truly became global, no longer was it simply a case of if the U.S. sneezed, the rest of the world caught a cold.  Nowadays, it is the American economy that can fall ill when economies in Asia or Europe skin their knees, bump their noggins, or catch a fever.
And this paradigm cannot be more evidenced where just this last week, China did three relatively minor monetary moves to their currency that caused panic in some quarters of the U.S. and European markets, despite the fact that these adjustments were in most cases less than 5%.

The Dow closed 211 points lower, after dropping as much as 250 points earlier in the day, while the S&P 500 and Nasdaq were also in the red on Tuesday. Markets in Europe and Latin America fell too.

The People’s Bank of China allowed the yuan to depreciate by nearly 2% against the U.S. dollar, the largest devaluation in two decades. China described the move as a one-off piece of market-reform, but many see it as a way to boost exporters and its cooling economy.

The move rippled through global markets and slammed stocks of many companies that sell goods in China, though some companies are set to benefit. The move also affected the exchange rates of several global currencies. – Money.CNN

China would later devaluate their currency one more time, while then backtracking and raising it on a third day by a tiny margin.

Pundits of course tried to downplay these moves as being a natural part of China’s economic cycle as their growth rate has slowed over the past quarter due to an overall slowdown in global consumer confidence and overall global demand.

global consumer confidence
global consumer confidence

However, behind the scenes Western central banks know that this Yuan devaluation is just the next phase of the ongoing global currency war that V forecast several years ago.  And already the Fed, BOJ, and the ECB are queuing up a new round of Quantitative Easing to try (failing of course) to stimulate the economy out its current deflationary spiral.

In particular, financial developments in China could have a larger than expected adverse impact, given this country’s prominent role in global trade.

Consider that, and consider the following statement sent to Bloomberg by an adviser to Japanese PM Shinzo Abe:

If [the Chinese move to devalue to yuan] suppresses external demand in Japan too much, the BOJ may further relax monetary policy.

Clearly, the ECB meeting took place ahead of China’s FX shocker, so the governing council’s reference to “financial developments in China” likely referred to the stock market collapse that was unfolding at the time, but the takeaway is the same: if developments in China’s financial markets serve to further undercut Japan and Europe’s quest to boost growth and stoke inflation (i.e. if China succeeds in exporting its deflation to trading partners), more QE and more easing will be just around the corner. – Zerohedge

The significance of this is… suddenly, the West is no longer controlling global monetary policy but is instead reacting to the actions taken by China, who seems to have wrenched that control from the impotent Western central banks.

Corporate Bond Crash worst since Lehman after Yuan Devaluation

corporate bond devaluation
corporate bond devaluation

Since China announced an update to their gold reserves, they have been prodding the U.S. and Europe with small pin pricks to see what reactions it would have on the fragile Western economies and monetary systems.  In fact, if China had really wanted to do some serious damage to the global economy they could have instituted more drastic corrections such as announce much higher gold reserves, increase their dumping of dollars, lowered their interest rates (which are still at or above 5%), and or as an extreme measure, completely un-peg their currency from the dollar.

The problem for the U.S. is that they have already played most of their cards, and are left resorting to military responses in retaliation of economic threats.  The sudden explosion last week of the Chinese port of Tianjin has many speculating that the West had a hand in this horrific event, and may have been in retaliation to China’s devaluation moves earlier in the week.

China has relied upon the American and European consumers for their lifeblood of trade and commerce for many years, but the days of needing to appease this segment of their economy is quickly coming to an end.  Declines in global consumer spending, coupled with the overall deflationary indicators showing we are now in a worldwide recession, has left China with no need to hold a stable relationship with the dollar and with the U.S., especially as the world accelerates its own ‘beggar thy neighbor’ policies to protect their own, and bring about a new cycle of protectionism.

Plans are only as good as the drawing board when the first shots are fired, and then the battlefield becomes a fluid enterprise of adapt and change.  And just like in chess, one rarely moves out the queen and rooks when they can accomplish strategic advantages simply by blocking an opponents moves with the positioning of pawns.  And make no mistake, recent actions by China and the PBOC have been minor stratagems done with minor pieces, but when your enemy is already down half his artillery, the smallest of moves can achieve severe and catastrophic damage.

While making its devaluation announcement, Beijing said that it wanted its currency “to reflect fundamentals” and to no longer simply mirror the movement of the dollar. It acknowledged the fact that its peg to the dollar was problematic and that it wanted a better, more natural mechanism. This is the key to understanding the announcement: The Chinese are preparing for a time in which the financial world does not spin in orbit around the dollar. Such a reality must make us think about the future. – Peter Schiff

13 comments

  1. “The sudden explosion last week of the Chinese port of Tianjin has many speculating that the West had a hand in this horrific event, and may have been in retaliation to China’s devaluation moves earlier in the week.”
    Jim Stone is of the same view but speculates it was for far more serious stuff of espionage by Hillary and more than just a problematic ’email inbox’. I don’t really buy that theory but its a possibility.

    http://82.221.129.208/ab8index.html
    This website is largely blocked in the western hemisphere according to Jim Stone so here are some excerpts:

    “Dead Meat Revelation: No Warehouse At Epicenter of Explosion”

    ‘This appears to me to be an obvious attack, and if it was, (in this day and age), can only be explained by targeting error with a kinetic weapon….The crater has the attributes of an impact crater, not a bomb blast, i.e. a RAISED CENTER (which could be seen before it was filled with water) and annular cracks (which can still be seen in all photos).

    [Annular cracks are those slightly curved lines going along the edge of the main crater.]

    “The explosion was actually closest to their security gate and whatever other shipping companies surrounded Ruihai.

    The explosion was so massive that many many buildings have completely vanished, including all warehouses and storage areas owned by Ruihai and surrounding shipping companies, with only a concrete office building remaining.

    All others are completely gone without a trace. Selective deletion of buildings (based on what they are made of) is a hallmark indicator of a nuclear weapons type blast, and if this was a kinetic weapon, results are similar.” – Jim Stone update

    “Take a look at the containers laying in the lower left corner of this picture – they have no paint or color, which means they had the surfaces incinerated by intense heat only a nuke or other super weapon would reach.

    If this was a carbide blast, they would be black or have their original colors to some degree, complete color change to only grey proves this explosion was FREAKING HOT.” – Jim Stone

  2. I just listened to some very interesting info on the coming turmoil for Sept. that are related to all things in RM arena.
    The info, theories, timeline and predictions Dr. Simon Atkins is talking about are fascinating.

    I have been experiencing several similar symptoms he talks about in the latter part of the interview, like total exhaustion and being drained since Monday.

    Give it a listen.

    https://soundcloud.com/phoenix-rising-29/2015-05-07-dr-simon-atkins-with-amazing-predictions

    1. Yeah listened to some of his material. Also felt exhausted last night. God knows but a lot of things are converging on September, including the Shemitah. Will be interesting to see if this Wave X will really cause the things he claims it will cause.

  3. I have been waiting for more evidence before commenting on the Tianjin situation. This was definitely NOT an accident. There have been theories ranging from a Tactical Nuke to Rod of God space weapon to Sabotage.
    First let’s take a forensic look at the location and actual explosion zone. The Where, When, and How.

    Where. Tianjin Port is a major logistical feeding point to Beijing and is the world’s 10th largest port. Its located approx 100 miles from Beijing.

    The When is suspiciously timed. 70 years (Shemitah x 10 for you prophecy followers) after the bombs dropped on Japan. First Aug 6. Second Aug 9. Tianjin on Aug 12. Each separated by 3. Seems like some psychos are trying to make their prophecies come true with a repeating 3 sequence.

    How. The actual impact point resulted in a large crater centered in an open area and not in some warehouse. Compare the before and after pics. here: http://nesaranews.blogspot.com/2015/08/dead-meat-revelation-no-warehouse-at.html The crater was then subsequently filled with water and foam due to firefighting efforts. The subsequent explosions and chemical contaminations are a result of nearby damaged facilities which apparently exceeded allowed limits of hazardous storage that magnified the intended result. The nature of the crater resembles that of a meteorite impact with raised edges. The explosion was felt many miles away with substantial property damage and loss of life. The explosions instantly destroyed six city blocks on the edge of the city of Tianjin. Scientific teams are investigating the area for traces of NBC (Nuclear, Biological, and Chemical). Public results will be murky at best knowing the tight lipped and heavily censored Chinese media. I am leaning towards the Rod of God space weapon at this point.

    Second looking at motive.

    What. What else is going on in the non-covered MSM media? Its no secret to the RMers that much has been going on with the BRICS/SCO meetings (HFT Cyberattack on Chinese markets at the last meeting); NDB (New Development Bank); AIIB; CIPS; SGE; Bilateral non-USD usage; Credit DRIED UP(as in USSA Credit Card cut); etc that are leading to the “Swarming” (a la John Robb) death of the Petro-Dollar. Many events leading to an alternative non-Western controlled system are converging around the Sep/Oct 2015 timeframe that would lead to a big nail in the coffin of the USD supremacy. V and others have also stated that the USD will be severely undermined by the end of 2015. This seems to be on track.

    Who. Who would be behind this blatant insane act of Terrorism and have the means to deploy this space weapon? Who are the Warmongers that desperately need a distraction? Who are the desperate Cornholios that are being purged and have the most the lose? Come on do I have to do your thinking for you? It should be obvious. The Cabal Khazanian Banking Mafia that’s who. They are at the directors at the top of the food chain. They are presently being purged according to Ben Fulford. They have the most to lose from the USD going bye bye. NO ONE is buying the USSA Bonds now except the Federal Reserve and their Butt-Buddies, the BLICS. Which means that when the USD as Reserve Currency goes bye bye in the near future all those fat easy manipulated profits and control goes bye bye. No chair in the new house for them thar fornicators.

    If there are any Western White Hats reading this, especially in the USSA, y’all best pull the cork out of yo arses ASAP and speed up the purges lest the Yankistanis be on the receiving end of the same gentle love shown to the Native American Indians by the Pioneers. The New Chinese management of the USSA are not going to be happy campers. Karma will be a Godzilla sized bitch on the back end.

    Like I said before, the Dragon has awoken and he is pissed. Someone naughty just twice shat in his house.

    1. SJ,
      You can bet your federal reserve note the cabal wants to shut the BRICS/AIIB down before it even gets started, once there is another option it will be to late to stop the exodus.

      Unfortunately, the kickoff was moved up an hour to an earlier start and we are now in the 2nd quarter of the “Great War”, the fans are still tailgating in the parking lot oblivious that kickoff was moved up an hour.

      Fight the good fight

      Republic of Texas

      1. TM,
        I think this latest attack is a pure act of desperation in hopes of shaking the tree. Sort of like a “Hail Mary” pass that is several years late and multiple $Trillions short. The psycho knuckleheads don’t want to go quietly into the night and instead are looking to kick over the table for EVERYONE in order to fulfill their retarded self-written Kabala prophecies/fantasies that justifies their Book of Fairy Tales and Second Coming Revelation spewings.

        I believe this will only harden the resolve of the New Sheriffs from the East in typical incompetent USSA “Blowback” fashion. The “Quickening” death of the Petro-Dollar will be accelerated and return on deposit magnified. Newtonian 3rd Law of Motion: “To every action there is always opposed an equal reaction”. Except this reaction will include a sizable amount of accrued interest. I think higher level Cabal members have been moved to the top of the “Removal” list for twice shitting in the Dragon’s House. If the Western White Hats don’t get off their arses, the Yankistani peasants will be on the receiving end of a gigantic Can-O-Whoop-Ass. The Brits and the Kosher Boys will also be getting their just due.

        I also think in the not too distant future there will be an increase of websites promoting “American Mail-Order Brides” and other economic refugee forums.

        There is also reason to believe that the 2018 Phoenix Rising Chipped World Currency will be moved closer.

        https://socioecohistory.wordpress.com/2014/07/26/flashback-1988-get-ready-for-a-world-currency-by-2018″-the-economist-magazine/

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