China threatens financial nuke

I’ll have to think through this before reaching any firm conclusions, but I’m dubious that what has been called the Chinese “nuclear option” of selling its T-bills is likely to be a very effective tactic.

If there is any further pushback from the US on any of these Chinese projects in Iran, then Beijing will invoke in full force the ‘nuclear option’ of selling all or a significant part of its US$1.4 trillion holding of US Treasury Bills, with a major chunk of the paper due to be sold in September on this basis. This massive holding of these bonds – through which the US finances its economy and is an important factor both in the value of the dollar and therefore in the health of US international companies especially – has been used as a bargaining chip before by China, especially when it feels threatened. Back in 2007, just before the great financial crisis, a number of senior Chinese figures at various state-run think tanks – through which China often signals its big geopolitical threats – stated that the large-scale selling of this massive Treasury Bill holding would trigger a dollar crash, a huge spike in bond yields, the collapse of the housing market and stock market chaos.

Such a tactic would neatly fit into China’s overall strategy to have the renminbi challenge the US dollar’s status as the key global reserve currency and the prime currency for global energy transactions. “The long-planned sequencing for this was inclusion in the SDR {Special Drawing Rights] mix, which happened in 2016, increasing use as a trading currency, which followed that, use as the key currency of an international energy trading exchange, which has occurred with the creation of the renminbi-denominated Shanghai International Energy Exchange in last year, and the calls from big oil producers and other major trading nations to use the renminbi, which has been happening over the past few years,” the head of a New York-based commodities hedge fund told OilPrice.com. Only recently, Leonid Mikhelson, chief executive officer of Russian oil major, Novatek, said that future sales to China denominated in renminbi is under consideration and that US sanctions accelerate the process of Russia trying to switch away from US dollar-centric oil and gas trading and the damage from potential sanctions that go with it. “This has been discussed for a while with Russia’s largest trading partners such as India and China, and even Arab countries are starting to think about it… If they do create difficulties for our Russian banks then all we have to do is replace dollars,” he said. “The trade war between the US and China will only accelerate the process,” he added.

At first glance, it looks to me the potential US response of simply repudiating its debt and declaring those T-bills to be of no value will be considerably more harmful to China than selling the debt will be to the USA.

Those who are focused on posturing and threats never seem to keep in mind that the enemy always gets a vote.


A house divided cannot stand

Both the USA and China are seeking to take advantage of unrest within the enemy’s borders, as a lengthy article by Strategy Page elucidates.

While 2018 was a bad year for the economy, 2019 is not much of an improvement. China hoped to maintain GDP growth of at least six percent while at the same time continuing to safely reduce (“deleverage) the huge number of bad loans local governments and corrupt banks have taken on over the last decade. The economic decline in 2018 could be measured in many aspects of economic activity (production, orders for raw materials, finished goods or construction and so on) and sentiments (of people running the economy and consumers). Chinese stock markets were down over 30 percent by the end of 2018 and for the first time in three years, profits of industrial firms took a dive. At the same time there were similar shocks to the American economy, but much more limited. Chinese and American leaders have not been able to agree on how to resolve trade and intellectual property disputes. China so far resists making any trade concessions. There is also supposed to be a halt in Chinese theft of American IP (Intellectual property) and commercial espionage in general. Until now the Chinese would often flagrantly cheat and then deny that they had done any such thing. This has been going on for decades and the recent American trade war is meant to deal with this long festering issue.

China is apparently hoping to be patient and take advantage of the current political turmoil in the United States. This has made most of the American media and many American politicians reluctant to criticize China mainly because American mass media is obsessed with overthrowing the current U.S. government. China sees an opportunity here and is taking it.

Damn him, deify him, or be disappointed in him, the observable fact of the matter is that God-Emperor Trump is about the only force standing in between the USA and its headlong plunge into economic contraction, violent civil conflict, and eventual collapse.

The schools are converged. The churches are converged. The corporations are soulless, corrupt vampires. The politicians are owned, leashed, and broken to heel. The military is converged.

Après Trump le déluge.


How to combat nationalism

Indian Prime Minister Modi is attempting a bold political stroke intended to extinguish the spirit of Kashmir’s independence and is utilizing some strategies that might strike the American observer as being more than a little familiar:

Internally, Modi’s bold re-designation of Kashmir as a union territory with a legislature is a dream fulfilled for Indian nationalistic sentiment which never accepted the compromise provisions in the Indian Constitution under Articles 370 and 35A, wherein Muslim-majority Kashmir had been allowed a parallel Constitution with a flag of its own. State governments in Kashmir had powers over law enforcement, residence and property rights. Central laws had no validity in Kashmir unless the local legislature approved them.

In effect, the autonomous status turned Kashmir into a ghetto with a mentality of uniqueness and distinctness from the rest of India. It strengthened the nearly seven million Kashmiri Muslims’ feeling that they are not Indians but a different nationality who deserve to keep Indians out of their paradisiacal enclave except as visiting tourists….

Over time, the halfway house existence of Kashmir as a state within India and yet a nation that does not emotionally belong to India failed to meet both India’s objectives and Kashmiri Muslims’ aspirations. Waves of anti-India uprisings and insurgencies, supported from across the border by Pakistan, kept Kashmir burning. Autonomy had become a slippery slope for separatism, jihadist extremism and alienation of Kashmiri Muslims from the rest of India.

Modi’s bet is that by corralling Kashmir under tighter central government control, he will marginalise the secessionist politicians there, open Kashmir up for the return of Hindu Kashmiri minorities who had been ethnically cleansed by jihadists in the late 1980s, and alter the demographic mix in Kashmir through settlement of Indians of all religious and ethnic backgrounds.

Since autonomy backfired, Modi is saying ‘enough with appeasement’ and aiming for assimilation and complete integration of Kashmir. Demographically, the idea is to dissolve Kashmiri separatism in a sea of Indian nationalism through the intermixing of populations, blunting the sharp edge of separatism that comes from lack of ethnic heterogeneity in the Kashmir Valley, where 97 percent of the population is Muslim…. Modi’s determined push for total absorption of Indian Kashmir into India proper presents an existential challenge to the long-entrenched Pakistani strategy of fanning alienation of Kashmiri Muslims against India. If Kashmiri Muslims are reorganised and no longer grouped together as an exclusive ethnic entity, Pakistan will find it a lot harder to foment the flame of self-determination.

Modi is redefining the very meaning and identity of ‘self’ in Kashmir, a process that will take years and decades, but whose endpoint will be dilution of pro-independence and pro-Pakistan affiliations in the reshuffled Kashmiri society of the future. Kashmiri Muslims may become further alienated from India as a result of this makeover, but Modi is calculating that, in years to come, they will no longer be numerically so dominant as to stymie Indian sovereignty.

Demographically dissolving a nation through the intermixing of populations and ethnic heterogeniety just sounds so very… 1965?

Anyhow, this strategy will almost certainly lead to war in Kashmir. And elsewhere.


Heating up all over

It looks increasingly as if the world wants war, despite the social mood metric of the stock market being at an all-time high.

New Delhi has declared it is revoking a decades-old constitutional provision that granted special powers to the Indian-controlled part of Kashmir. The move comes amid ongoing flare-ups between India and Pakistan over the region.

The majority-Muslim region that became part of India in the times of decolonization, and has been a point of dispute between India and Pakistan ever since, has enjoyed broad autonomy under the Indian constitution. It is the only Indian state that was allowed to have its own constitution.

All laws passed by the Indian parliament, except for those regarding defense, communications, and foreign policy, had to first be ratified by the local legislature before coming into force in Kashmir. Apart from that, only local residents could purchase land or property in the state or hold office there.

This will no longer be the case starting Monday, New Delhi has announced. A resolution to revoke Kashmir’s special status was introduced on Monday by Home Minister Amit Shah and enshrined in a decree signed by President Ram Nath Kovind, the ceremonial head of India.

Translation: The Hindu nationalists are intending to crack down hard on India’s Muslims. I wouldn’t be at all surprised if there were large-scale population transfers in the cards. Remember, we’re living at the end of one of the greatest global peacetime expansions in human history. The correction will therefore likely be of similar scale and scope.


Tinder, meet the sparks

Michael Snyder notes three very dangerous developments that have the potential to lead to significant large-scale conflict on Zerohedge.

  • Israel has been striking Iranian military targets inside Syria for months, but now the rules of engagement have apparently changed, because in recent days the IDF has started conducting airstrikes against Iranian targets inside Iraq. The reason this is being called “an unprecedented move” is because this is the very first time since 1981 that we have seen Israeli airstrikes inside Iraq. Needless to say, these latest airstrikes have absolutely enraged the Iranians.  It looks like the Israeli government has determined that any Iranian military targets outside of Iran itself are fair game, and it is probably only a matter of time before Iran strikes back in a major way.
  • The political protests that have made global headlines in Hong Kong in recent weeks have greatly angered the Chinese government.  They were probably hoping that the protests would quickly subside and soon be forgotten, but that hasn’t happened. So now China is faced with a decision.  If such protests were happening elsewhere in China, they would be brutally crushed, but Hong Kong is a special case. If the Chinese are too harsh with the protesters in Hong Kong, that could turn world opinion against them, but if they do nothing that could encourage protests to start happening in other area of the country. In the end, the Chinese will probably do what they always do, and that means crushing the opposition.
  • North Korea just fired two more missiles into the ocean. The North Koreans are greatly alarmed by the joint military drills that the U.S. and South Korea will soon be conducting, and whenever they get greatly upset about something they seem to express that displeasure by firing off more missiles.

Of the three, I think the Hong Kong situation is the most delicate and the North Korean one the most trivial. North Korea has carried out more than 80 strategic missile tests since Kim Jong-On became Supreme Leader in 2011, so what do two more signify? However, there is also a fourth major development that is probably as dangerous as all three of those situations combined, but is little noted in the USA as yet because it doesn’t involve Israel or China or nukes.

Turkey has threatened to re-open the floodgates of mass migration to Europe unless Turkish nationals are granted visa-free travel to the European Union. The EU agreed to visa liberalization in a March 2016 EU-Turkey migrant deal in which Ankara pledged to stem the flow of migrants to Europe. In an interview with Turkish television channel TGRT Haber on July 22, Turkish Foreign Minister Mevlut Çavuşoğlu said that Turkey was backing out of the migrant deal because the EU had failed to honor its pledge to grant Turkish passport holders visa-free access to 26 European countries.

“We have suspended the readmission agreement,” he said. “We will not wait at the EU’s door.”

A day earlier, Turkish Interior Minister Süleyman Soylu accused European countries of leaving Turkey alone to deal with the migration issue. In comments published by the state news agency Anadolu Agency, he warned:

“We are facing the biggest wave of migration in history. If we open the floodgates, no European government will be able to survive for more than six months. We advise them not to try our patience.”

The migration deal, which entered into force on June 1, 2016, was hastily negotiated by European leaders desperate to gain control over a crisis in which more than one million migrants poured into Europe in 2015.

Under the agreement, the EU pledged to pay Turkey €6 billion, grant visa-free travel to Europe for Turkey’s 82 million citizens, and restart accession talks for Turkey to join the EU. In exchange, Turkey agreed to stop the flow of migrants to Europe as well as to take back all migrants and refugees who illegally reach Greece from Turkey.

Turkey currently hosts an estimated 3.5 million migrants and refugees — mainly Syrians, Iraqis and Afghans. Many of these people presumably would migrate to Europe if given the opportunity to do so….If the EU approves the visa waiver, tens of millions of Turks will gain immediate and unimpeded access to Europe’s passport-free zone. Critics of visa liberalization fear that millions of Turkish nationals may end up migrating to Europe. The Austrian newsmagazine, Wochenblick, reported that 11 million Turks are living in poverty and “many of them are dreaming of moving to central Europe.”

Not every European government will fall if the migration spigot is turned on again – those countries already fortunate enough to have solid anti-migration parties in government will see the strength of those parties skyrocket – but the German and French governments will most certainly fall and the collapse of the Berlin-Paris axis would suffice to account for the European Union as well.


Do you want Nazi 2.0?

Because this is how you get Nazi 2.0:

A chilling incident in which a young boy and his mother were pushed in front of a high-speed train by an Eritrean man has sent shock waves across Germany and seemingly rekindled anti-migrant sentiment.

The tragedy took place on one of the platforms of the central railway terminal in the German city of Frankfurt – the nation’s second busiest railway hub. An eight-year-old boy and his mother were waiting for a train when they were suddenly attacked by a 40-year-old Eritrean. The assailant grabbed the woman and the child and threw them on the rail tracks right as the high-speed intercity express (ICE) was pulling into the station.

The 40-year-old woman managed to escape near-certain death as she made it to the pathway between two tracks. She tried to reach out to her son when the train ran over him, a witness told German media. The boy died at the scene.

The terrible scene left everyone at the station shaken. The ambulances that arrived shortly had to hospitalize some who were suffering from shock. The boy’s mother was also hospitalized, though there has been no information on her condition.

The perpetrator also tried to force another person onto the railway tracks but his third would-be victim escaped. The attacker then attempted to flee the scene but was pursued by a group of passengers and eventually detained by police outside the terminal.

I won’t blame the Germans in the slightest when they start attacking both their own traitorous politicians as well as the migrants welcomed by them. And that’s definitely “when”, not “if”. Nor will I fault that mother if she goes after every single CDU politician with a woodchipper. Their idiotic virtue-signaling has led directly to unthinkable horrors for the German nation.

Multiculturalism will never, ever, work. Diversity is a curse and a prelude to war. English and Spanish settlers never became American Indians. After centuries of “integration” African-Americans remain a nation apart. After 120 years of immigration to the Middle East, Jews have not become Arabs.

There is no Magic Dirt anywhere to be found on the planet.


Deep State foiled again?

The rumor is that the arrested Marines were smuggling in snipers who were intended to attack the President:

Sixteen US Marines were arrested Thursday for alleged involvement in various illegal activities ranging from human smuggling to drug-related offenses, according to a statement from the Marine Corps.

The arrests took place in a dramatic fashion on Thursday morning at Camp Pendleton, California, during a battalion formation.

“Information gained from a previous human smuggling investigation precipitated the arrests,” the statement said. “None of the Marines arrested or detained for questioning served in support of the Southwest Border Support mission.”

I assume these arrests were likely related to the news that an entire SEAL team had been sent home:

Thursday’s arrests come one day after the US military took the rare step of sending home an elite team of Navy SEALs from Iraq due to “a perceived deterioration of good order and discipline” that caused a military commander to lose “confidence in the team’s ability to accomplish the mission.” 

It looks like things are beginning to heat up quickly now that Epstein is in custody and Mueller has been exposed. And apparently it was Russian military intelligence that exposed the plot. We can only hope and pray that the President’s forces are prepared to act soon. Q is confident and states that nothing can stop what’s coming, and we can hope that they are correct.

However, note that the description of the former FBI agent comments on Tucker Carlson’s show was taken out of context, as they clearly referred to the Mueller hearing and not any assassination attempt. So, this may simply be someone putting a few known pieces of the puzzle together in a fictitious manner.


“certain forces”

The Iranians are not fooled by the “escalating crisis” either:

As Tehran and London trade accusations over the seized tankers, Iran’s ambassador in London warns that certain forces in the UK aim to use the crisis to boost tensions even further. Ramping up pressure would be dangerous and “unwise,” Hamid Hamid Baeidinejad warned in a tweet on his personal account on Sunday.

That’s why it’s key now for the UK government to “contain those domestic political forces who want to escalate existing tension between Iran and the UK well beyond the issue of ships.”

That said, Tehran is “firm and ready for different scenarios,” Baeidinejad said.

Translation: Iran knows it’s the neoclowns trying to draw the USA into war against Iran using the UK. President Trump knows it’s the neoclowns trying to draw him into war against Iran using the UK. The admirals and generals of the US military know it’s the neoclowns. And they all know this is now happening due to the neoclowns’ inability to start a war with Russia in the 2015-2018 period.

No one is fooled in the slightest. Send them back too, Mr. President.

As for the recent troops movements into Saudi Arabia, that probably has far more to do with the fact that the Saudis are losing their war with the Houthis in Yemen than anything to do with Iran.


The US military contemplates child soldiers

And here I thought utilizing child soldiers was a sign of an uncivilized society:

The best way to fix the U.S. armed forces’ recruiting challenges may involve dipping further into the nation’s high schools.

As the Army, Navy and other services contend with a thriving economy and a directive to expand their ranks, there is a growing debate over whether the military should consider lowering the minimum enlistment age from 17 to 16. More than a dozen countries, including the United Kingdom, already have adopted the policy.

Critics say the idea is deeply flawed and presents a host of societal problems, but supporters argue that the Pentagon needs to think outside the box if it wants to continually overcome one of the toughest recruiting environments in decades.

One would have thought now that women are permitted to serve in combat roles, the doubling of the potential pool of recruits would prevent any personpower shortages. If, of course, one were a clueless equalitarian who doesn’t see sex or color.

Perhaps it would be more efficient to simply declare a warrior caste and require everyone born into those families to serve in the military.


A tanker for a tanker

I don’t see what Great Britain has to complain about, considering that they quite literally started it.

TWO British oil tankers with dozens of crew on board were seized by Iran’s Revolutionary Guards less than an hour apart today in the Gulf.

The Government’s Cobra committee is holding an emergency meeting in Whitehall tonight after the Stena Impero and Mesdar were halted by troops in speedboats and helicopters and diverted to Iran.

The raids came exactly two weeks after Royal Marines boarded a supertanker off Gibraltar suspected of carrying Iranian crude oil to Syria – prompting Tehran to threaten “retaliation”.

British-flagged Stena Impero was sailing to the Saudi port of Jubail today but ship tracking data shows it veered off course with a sharp turn north at around 4.17pm UK time. Iran’s state news agency IRNA said it had been “impounded” and claimed the tanker had turned off its tracker, ignored warnings from the Revolutionary Guards and was sailing in the wrong direction in a shipping lane.

The Impero was surrounded by four vessels and a helicopter. State-controlled TV claimed the ship was seized because it was “violating international maritime rules”. Less than an hour later at around 5pm the Mesdar – Liberian-flagged but operated by the UK firm Norbulk Shipping UK – also turned sharply north towards Iran’s coast having been surrounded by ten speedboats after passing westward through the Strait on its way to Ras Tanura.

It looks like the neoclowns couldn’t get President Trump to bite, so they’ve got Theresa May doing their bidding in the hopes of enmeshing the US military that way. I suspect they’re desperate to start a war in the Gulf in the hopes of creating a distraction from the coming Epstein-related arrests. And I very much doubt that either the President or the U.S. Navy is going to fall for the neoclown antics.

One article on the Daily Mail finally gets around to admitting that the Iranian response was both provoked and measured by the initial British action.

Fears were raised that the Iranian authorities were trying to seize a UK ship in retaliation for the detention of the Grace 1 tanker. The Iranian ship was detained off the coast of Gibraltar on July 4 after it was suspected of violating EU sanctions by carrying a cargo of crude oil destined for Syria. The ship’s captain, chief officer and two second officers were arrested and bailed and an investigation is ongoing.

Iran’s supreme leader Ayatollah Ali Khamenei called the tanker’s seizure an act of ‘piracy’ on Tuesday and warned the UK to expect a response.

Of course they knew Iran would do something like this. However, I expect they were looking for a more violent escalation. It’s a little hard to bang the war drums when the other side is obviously just responding in kind to your own actions.