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This post was edited by abramicus at 2015-10-29 16:21|
die_begierde Post time: 2015-10-29 00:18
What say you if I suggest that China retaliates with upping the ante at the currency war table?
ALL MODERN WARS ARE DISGUISED CURRENCY WARS
"Currency War" has been conceived as war using currency as a weapon. But we have to disagree with this definition, because the object of major wars, since history began, were wars to establish ownership of the currency in other territories, currencies which used to be denominated in gold, silver and their equivalents of precious stones, but now, currencies which have the same ability to satisfy demand, based on the rule of force, called "Fiat reserve currencies".
Fiat currencies allow a country or a person to accumulate far greater purchasing power than the existing worldwide supply of gold, silver, other precious metals and stones, can embody. The wars that they generate, therefore, become orders of magnitude greater in intensity, scope and duration than previous wars waged to loot the gold and silver of other nations.
The "right of passage" through the maritime heartland of the East Asian countries that promise to generate more than half of the world's GDP in a few years, is about the right also to deny passage of other countries through these maritime routes, and thus, by showing one's power to deny passage, communicate the threat to those who refuse to accept one's fiat currency as payment for their goods and services, of mass starvation and cannibalizing siege.
So, this is after all, a Currency War, disguised as a dispute over passage and land ownership. What is at stake is which country will be able to dictate to the East Asian nations that they should accept its fiat currency as payment for its imports from them. You see, it not about the $15 Trillion Dollars of trade that goes through this region annually. It is about the Y90 Trillion Yuans of trade, alternatively, that goes through this region. And the problem is not whether such trade can continue, but rather, with which currency it shall be paid.
As to the use of currency as an instrument of war, all it takes is an ounce of political will, and China can make Japan kneel instantly by letting the Yuan devalue naturally to 7.00 yuans/dollar, or even to 8.00 yuans/dollar. But China needs to first have that political will to do what is necessary. Right now, it does not exist. Instead, the will to surrender to Japan underlies much of what passes as "Consumer Driven Economy" made possible only by the overvaluation of the Chinese Renminbi, powered by the losses of hundreds of billions of dollars from China's foreign currency reserve.
The world is about to be plunged into darkness, sooner than anybody thought.