International dollar trend

POSTED BY: SIGNYM
UPDATED: Wednesday, August 26, 2026 00:49
VIEWED: 4411
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SIGNYM

Monday, September 7, 2015 11:23 PM

But I have no idea what the hell it means.

Sorry for the teaser, but one of my buddies has been pointing out this trend for the past six months, insisting that It's important! but for some reason, altho I see that it's happening, I can't figure out what it means:

With the incredibly reduced price of oil, all of the oil-exporting nations are getting a LOT fewer dollars for their product.

Much of that money was used to buy US Treasuries (USTs) and put into either a Sovereign Wealth Fund (SWF) or into foreign exchange reserves (FXR) (some nations distinguish between the two, some don't.)

But as a result of getting far fewer dollars since the oil price slump (which began over a year ago) a number of nations are having to dip into their reserves, selling their Treasuries for dollars and then using those dollars to "buy stuff" from abroad.

I've heard that Saudi Arabia and Qatar are in the boat, and I assume Venezuela, Brazil, and Russia are also doing the same.

FWIW, here is a list of oil-producing nations, ranked by volume of production. So all of the below listed nations (except the USA) may be liquidation their USTreasuries for cash:

Russia 10,107,000
SA 9,735,200
USA 9,395,000
China 4,189,000
Canada 3,603,000
Iraq 3,368,000
Iran 3,113,000
UAE 2,820,000
Kuwait 2,619,000
Mexico 2,562,000
Venezuela 2,501,000
Nigeria 2,423,000
Brazil 2,255,000
Angola 1,831,000
Kazakhstan 1,573,000
Qatar 1,553,000
Norway 1,539,000
Algeria 1,462,000
Colombia 1,003,000

What's interesting is that CHINA, altho not an oil exporter, ALSO has a huge stash of foreign reserves on-hand from its days as "factory to the world" - including a massive pile of US Treasuries. And curiously, it's ALSO liquidating its holdings of USTs at an unprecedented rate: from $4T at peak to $3T now, $94B in the last month alone.

So many nations, selling lots Treasuries. This means that the US government will have a harder time financing its debt because it will no longer be able to sell Tbonds for quite the same price.

Now, I know that both China and Russia are trying to "de-dollarize" their region and isolate their economies from western communications and financial sanctions. I also know that China is trying to become a world reserve currency via IMF blessing, but that the IMF has set hurdle after hurdle between China and its goal. I wonder if China has decided to throw in the towel on becoming a world reserve currency with official western blessing, and perhaps has decided to become a reserve currency anyway by the backdoor. (AIIB, BRICS Bank etc.)

However, the implications of these global Treasury sales somewhat eludes me. In the world of supply-and-demand, this SHOULD mean that - if the US government wants to keep financing its debt - it will have to offer a higher interest rate to attract buyers. A higher offered interest rate might accelerate a flight from stocks, and this would have all kinds of interesting implications, from a loss to banks (which lent for stock purchases) to an increase in the value of the (cash) dollar and the decline of other currencies. But things are seldom what they seem in the world of international finance.

I just posted this as a placeholder while I turn this information over to see if it assumes some sort of recognizable shape. But if anyone has anything to add, feel free! Because, while this is big, its ultimate affect is a puzzler.

SECOND

Tuesday, September 8, 2015 12:43 AM

Quote:
Originally posted by SIGNYM:
But I have no idea what the hell it means.

So many nations, selling lots Treasuries. This means that the US government will have a harder time financing its debt because it will no longer be able to sell Tbonds for quite the same price.

However, the implications of these global Treasury sales somewhat eludes me. In the world of supply-and-demand, this SHOULD mean that - if the US government wants to keep financing its debt - it will have to offer a higher interest rate to attract buyers.

I look at the 10 and 30 year rate and I can't see the problem you are imagining. Rates going down, not up.
10-Year US Treasury Constant Maturity Rate 2015-09-02: 2.20 Percent
30-Year US Treasury Constant Maturity Rate 2015-09-02: 2.97 Percent

Go to the Federal Reserve and look at the history of rates the US government pays. Those rates get lower every year.
https://research.stlouisfed.org/fred2/series/DGS10
https://research.stlouisfed.org/fred2/series/DGS30

If China was not dumping US Treasuries, would that mean interest rate would go negative? People paying the US Government to hold their money? It would be FREE MONEY. When rates are 2.2% and inflation is 2.15% then borrowing is very close to FREE MONEY. You can see the inflation here:
https://research.stlouisfed.org/fred2/series/T5YIFRM

SIGNYM

Friday, September 11, 2015 10:40 PM

You're absolutely correct: Treasury rates are low. And yet, China is clearly dumping Treasuries (not easy to tell if that's by choice or of necessity) and other nations - like the Gulf Arab states are selling Treasuries to scratch up cash in order to make up for the shortfall in (oil dollar) revenues.

There is a lot of underlying data indicating that the world economy is heading toward recession/depression, if not already in one. Stock markets and Treasury rates notwithstanding. You have to separate "the financial markets" from "the economy" - they decoupled a long time ago, and no longer have any relationship to each other since central bank "quantitative easing".

I was convinced in early 2008 that disaster was just around the corner, and said so repeatedly. My reasoning was that the gap between the rich and everybody else was as high as it's been since 1929. Once the vast majority stops being able to purchase much, the economy goes into what's called a "vicious cycle" ... inventories go up, workers are laid off, jobs are lost, which means more purchasers are lost, which means inventories goes up, which means more workers are laid off, which means ...

The same still holds today. The Fed, and other central banks, threw money at their member banks, but that money really hasn't trickled down to the vast majority of people who create aggregate demand.

The exact mechanism of the failure - in 2008 it was the failure of speculative mortgages, which allowed consumption well beyond the incomes of many people - doesn't matter. The situation still holds. Demand is low. Production is low, and therefore commodities (the basic "stuff" required to "make stuff" like petroleum, copper, iron, and coal) are low. Commodity exporting nations - like Saudi Arabia, Venezuela, and Brazil- are hurting. Brazil's bonds were just downgraded to junk status.

The only thing holding up is the almighty dollar, which - once again, and still- allows the USA to purchase well beyond IT'S ability to ever pay anyone back in real goods.

It's like a game of Jenga - there's a huge pile of rickety economic blocks, and one by one circumstances are pulling them out. I believe that China and Russia are doing their best to pull out THE block which makes the whole thing come tumbling down. I'm just trying to figure out what that block is.

--------------
You can't build a nation with bombs. You can't create a society with guns.

SECOND

Saturday, September 12, 2015 11:59 AM

Quote:
Originally posted by SIGNYM:
You're absolutely correct: Treasury rates are low. And yet, China is clearly dumping Treasuries (not easy to tell if that's by choice or of necessity) and other nations - like the Gulf Arab states are selling Treasuries to scratch up cash in order to make up for the shortfall in (oil dollar) revenues.

You could tell a story in which USA becomes dependent on Chinese loans; then, when China gets in trouble, it demands repayment, pushing USA into crisis too. But any story along those lines has a corollary: we should be seeing a spike in US interest rates as its credit line gets pulled. What you actually see is falling rates.

Changing the subject to: the euro is bad for Europe. Fortunately, Poland does not use the euro. Good for them. I saw a very short article explaining, by comparing two backward European economies, Poland and Greece, how destructive the euro has been to the economy of Greece. Not using the euro has been a great advantage for Poland. http://krugman.blogs.nytimes.com/2015/09/11/poland-versus-greece/

Does Poland understand? Maybe! Maybe not. It wants to join the euro because the euro is sacred to a vision of a unified Europe.
www.telegraph.co.uk/finance/economics/11762020/Poland-will-never-join-
a-burning-eurozone-says-central-bank-governor.html

The euro is just one of many terrible economic decisions that are depressing the world. Does the world quickly learn from its bad decisions? No.

SIGNYM

Saturday, September 12, 2015 7:50 PM

It's not just the euro that's a terrible decision. I can point to terrible decisions everywhere:

The decision to allow savings banks to play with their deposits like investment banks (Thank you, Bill Clinton).

The decision to NOT prosecute banks for fraudulent and predatory loans, like Eliot Spitzer wanted to to (Thank you GWB).

The decision to appoint Timmy Geithner, Wall Street apprentice, as Treasury Secy (thank you, Obama).

The decision to transfer MOAR wealth to the wealthy, on the excuse that it would "trickle down" (Thank you, every Republican that's held office since Reagan was inaugurated - and most Dems too!)

The decision to allow virtually unregulated futures trading on commodities (Thanks again, Bill!).

The decision to outsource jobs to Mexico (Bill, again) and China (GWB).

China's decision to
1) Tie its development to exports to the USA (Walmart and Apple, specifically)
2) Use "investment" as a mainstay of their economy
3) Prevent cities and regions from having their own tax base, which required them to float risky bonds.
4) Depend on "shadow banking" to fill in for the PBoC.
5) Increase its official debt from $7T in 2008 to $28T today
6) Try to "stimulate" the economy by blowing a series of bubbles in real estate, commodities, and the stock market.

The overall allowance of ALL banks to be able to "print money" through fractional reserve lending. (Because, when a bank can lend money it DOESN'T HAVE ... which is what happens 95% of the time ... it is -actually - printing money: i.e. creating money out of thin air. If we tried that in our basements, we'd be accused of counterfeiting.)

The decision of the government to bail out the banks to the tune of about $17T (thanks GWB and Obama) and by The Fed to throw money at its member banks, and the correlated decision by Washington Republicans NOT to allow massive deficit spending to throw money at people. In fact, bailing out the banks was the stupidest decision, because of of the "multiplier effect" that Geithner convinced Obozo would work on his behalf actually worked in the wrong direction: in order to make each bank whole, the government handed out more money to each bank than if it had simply made bought each troubled mortgage by itself.

The reliance of world banking on the IMF and World Bank and SWIFT and BIS.

The decision by most of the world banks to agree to the mechanism of "bail-ins", in which the banks get to take depositor's money in case their risky investments go bad.

The decision by the Fed to lower interest rates to near-zero for its member banks (which then went on to either use that money directly to buy stocks, or to loan that money to businesses for their own stock buy-backs. Thank you Ben Bernanke and Janet Yellen!)

I could point to probably a dozen more very poor decisions, all leading to the clusterfuck that we have today, in which the "debt overhang" by banks and in futures is at least 20X the real world GDP, when you include (privately-traded) derivatives.
http://www.quora.com/How-can-the-worlds-total-financial-obligations-be
-20X-world-GDP

I haven't read Picketty's book, "Capital in the 21st Century", but by description the main thesis is that "finance" always has a higher rate of return than "production", and therefore money (investments) tend to gravitate towards lending for financial products such as stocks, futures, and derivatives. But these expectations of future rewards can't POSSIBLY be met by an underpowered economy: The only way to get a real 6% return is with a real 6% growth rate. With the level of indebtedness, the economy can't possibly grow that far, that fast, to meet those expected rates of return, so the only thing left for the various central banks to do is start printing more money for more loans to pay for the previous loans.

This is what the stock market is doing right now:
h

SIGNYM

Saturday, September 12, 2015 8:05 PM

BTW, I thought I should mention: ALL derivatives are priced in dollars. Japan is the largest Treasuries holder, China is second. The dollar is a world reserve currency. By agreement, it is also used to price and buy oil... i.e. West Texas Intermediate (WTI) and Brent crude. Every financial arrangement in the western world is based in some way on the dollar. And if for some reason the dollar should lose value, a lot of other things will come tumbling after.

CHINA is busy pulling out those Jenga blocks, and RUSSIA is doing what it can in the same direction. China seemed to have picked up the pace since the IMF declined to allow China Special Drawing Rights (SDR) about a month ago, in what appears to be a purely political decision. http://www.zerohedge.com/news/2015-08-19/no-sdr-you-imf-tells-china-wa
it-least-one-year-until-reserve-basket-inclusion

China has opened the Asia Infrastructural Investment Bank (AIIB), in which dozens of western nations chose to participate.

China opened its own gold fix market.

China just created the petro-yuan, and oil market in which oil is priced in yuan.

The Petroyuan Cometh: Launch Of Renminbi-Denominated Oil Futures Contract Imminent
http://www.zerohedge.com/news/2015-09-11/petroyuan-cometh-launch-renmi
nbi-denominated-oil-futures-contract-imminent

From its lesser economic status, Russia is creating dollar-free trade zones. Russia and China have created a SWIFT-free interbank exchange route, which I imagine will be extended to other nations.

In other words, China (and to a lesser extent) Russia are busy-busy-busy pulling out those Jenga-blocks.

--------------
You can't build a nation with bombs. You can't create a society with guns.

SIGNYM

Saturday, September 12, 2015 8:54 PM

BTW, if it seems like I'm beating every reader to death with facts, I'm just hoping that if I toss enough stuff out here, somebody might see a pattern that I don't. So have at it!

--------------
You can't build a nation with bombs. You can't create a society with guns.

SECOND

Saturday, September 12, 2015 10:14 PM

Quote:
Originally posted by SIGNYM:
BTW, if it seems like I'm beating every reader to death with facts, I'm just hoping that if I toss enough stuff out here, somebody might see a pattern that I don't. So have at it!

The pattern of failure is that economic decisions are being made based on gut instincts about how money and economies function. It just so happens that guts are not as smart as brains.

OPEC is my favorite example because I live in Texas on top of an oil field. The cartel doesn't seem to me to be making smart decisions, but Forbes disagrees and sees low crude prices as a deeply clever plot to prevent competition from other energy producers: www.forbes.com/sites/danielfisher/2015/01/16/opec-losing-its-grip-no-t
he-saudis-are-partying-like-its-1981/

It is not just crude oil. It is everything about economics. No matter what dumb-ass economic decision is made, many will defend the decision as wise and to hell with facts, history, or economic modeling. Their gut instincts tell them they are right and nothing that happens but death or bankruptcy will ever change their gut feelings.

SIGNYM

Saturday, September 12, 2015 10:22 PM

So ... USA facing bankruptcy? Is that what it would take to reverse those terrible decisions? Because at this point, there's nothing behind the USA dollar except hot air. And the military. We must never forget that.

----

What I see is a low-price oil strategy, which is designed to wring out the expensive producers from the market. I recall, from the days of the Iraq invasion, when ppl, were wondering about all of those oil wells and their future viability, a comment that you can't shut an oil well down for too long because then they clog up. So if Saudi Arabia manages to throttle shale oil and tar sands back, and maybe even fracked natgas and nuclear energy ... what would it take to get back on line? My guess is that most producers will keep their wells running... slowly. But you're from Texas, so what do you think? Is coming back on line after being idled a problem?

--------------
You can't build a nation with bombs. You can't create a society with guns.

SECOND

Sunday, September 13, 2015 7:38 PM

Quote:
Originally posted by SIGNYM:

... what would it take to get back on line? My guess is that most producers will keep their wells running... slowly. But you're from Texas, so what do you think? Is coming back on line after being idled a problem?

Producing too fast hurts an oil field. Producing too slow hurts nothing.

I saw an article this morning that reminded me why economies should NOT be run to satisfy the prejudices and gut instincts of business about economics. It is because the character and honesty of businessmen is very questionable. Money makes businessmen stupid about anything that gets in the way of making money. In their rush to make as much money as fast as they could, Blue Bell in Brenham Texas couldn't even make plain vanilla without chopping off workers' fingers in the ice cream machine and killing customers with listeria. Blue Bell is the fastest growing, biggest ice cream maker in Texas and was shutdown, temporarily, by the government.

www.houstonchronicle.com/news/houston-texas/houston/article/Inside-Blu
e-Bell-Grime-and-discontent-6499325.php
Inside Blue Bell’s factory: Grime and discontent
Ex-workers cite long-term issues at Brenham plant by Mark Collette

Benjamin Ofori sometimes watched a mush of strawberries and pecans flow into an ice cream tank even after his production line at Blue Bell had been scrubbed.

Low water pressure and temperature hampered Sabien Colvin’s cleanup efforts at the plant.

Another employee saw a steady drip, day after day, from a dirty air vent onto Fudge Bombstiks.

They say they all complained to supervisors.

Ofori also groused about a bypassed safety feature on his line. Later, that machine severed three of Colvin’s fingers.

In interviews with the Houston Chronicle, more than a dozen former employees of Blue Bell’s flagship Brenham plant described a company fighting to keep up with its growing customer base while sanitation and safety slipped. Cleanup workers regularly ran out of hot water, making machinery susceptible to pathogens and allergens. Reused packaging brought grime into the factory. Equipment went without safeguards for years, and several workers lost parts of one or more fingers.

The 14 employees have a combined 213 years of experience on the production lines. Their accounts are bolstered by the limited information reported by the Food and Drug Administration, including details about a contaminated machine that kept cranking out products even as a listeria crisis deepened. They’re also backed by an Occupational Safety and Health Administration investigation that blasted the company for failing to protect workers.

Blue Bell officials would not agree to an interview to discuss the ex-employees’ assessments of their operation.

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The world's economy is run to satisfy businessmen only motivated by money. I think that is very unwise, but businessmen disagree, obviously.

SIGNYM

Sunday, September 13, 2015 9:02 PM

Wow, it's a good thing I never ate their ice cream!

That's one thing that libertarians don't take into account. They think "the market" is the solution to everything, and that if people only behaved in a "free market" fashion, they would be informed consumers and workers and would never put up with that kind of shit. That's a little like saying that you, as an individual, can negotiate effectively with the Mafia.

But you said something I'd never heard before- that producing too quickly can harm a well. I'm something of a geek .... since we have a lot of re-worked oilfields here, I wound up looking up oil wells ... how they're revived/ stimulated, how little grains eventually clog up the slots in the producing part of the well, about concrete casings and such (It helped me understand the Deepwater Horizon BP gas/oil breach). But I've never heard about that, so if you have more details, I'd be very interested!

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You can't build a nation with bombs. You can't create a society with guns.

SIGNYM

Sunday, September 13, 2015 10:01 PM

Much is made of China's hugely increased debt-to-GDP ratio. But according to this picture, I see that many nations (including the USA) are pretty much in the same category ...

--------------
You can't build a nation with bombs. You can't create a society with guns.

SIGNYM

Sunday, September 20, 2015 11:15 PM

This rather long article is by Pepe Escobar. He's kind of wordy, and sometimes his hypotheses don't pan out, but he's very knowledgeable and always worth reading.

Synposis: Russia is considering defaulting on its debts to the west, not because they can't pay, but in response to the economic warfare unleashed by the west. The economic war itself has unleashed a reorientation of Russia's and China's economies and militaries, which will focus on missiles.

Quote:
Let’s start with some classic Russian politics. Finance Minister Anton Siluanov is drawing up Russia's economic strategy for 2016, including the government budget. Siluanov – essentially a liberal, in favor of foreign investment - will present his proposals to the Kremlin by the end of this month.

So far, nothing spectacular. But then, a few days ago, Kommersant leaked that Russia's Security Council asked presidential aide Sergei Glazyev to come up with a separate economic strategy, to be presented to the council this week. This is not exactly a novelty, as the Russian Security Council in the past has asked small strategy groups for their economic assessment.

The Security Council is led by Nikolai Patrushev, the former head of the Federal Security Service. He and Siluanov are not exactly on the same wavelength. And here’s where the plot thickens. Glazyev, a brilliant economist, is a Russian nationalist – sanctioned personally by the US.

Glazyev is arguably going no holds barred. He is in favor of barring Russian companies from using foreign currency (which makes sense); taxing the conversion of rubles to foreign currencies (same); banning foreign loans to Russian firms (depending if they are not in US dollars or euro); and – the smoking gun - requiring Russian companies that have Western loans to default.

Predictably, some sectors of US ‘Think Tankland’ went bonkers, stating with utmost certainty that “the Russian energy sector would not be able to find much financing without connections to the West.” Nonsense. Russian firms would easily find financing from Chinese, Japanese or South Korean sources.

Whatever measure of attention Glazyev will get inside the Kremlin, the whole episode already means that Moscow harbors no illusions in the near future regarding the exceptionalists (one just has to look at the presidential candidates, from ‘El Trumpissimo’ to ‘The Hillarator’); as Russian Deputy Foreign Minister Sergei Ryabkov recently put it, ”[we] should expect toughening of the sanctions pressure.”
Once thing though is absolutely certain; Moscow won’t bend over backwards to “pacify” Washington.

Neo-Tsarism, anyone?

One might be tempted to see Glazyev drawing up plans to return to some sort of Tsarist self-sufficiency while cutting off ties with the West. Assuming some version of that would be approved by the Kremlin, what’s certain is that it may turn into a huge blow the EU might not recover from.

Imagine Russia defaulting on all its foreign debt - over $700 billion – on which Western sanctions have raised extra, punitive costs in terms of repayment.

The default would be payback for the twin Western manipulation of oil prices and the ruble. The manipulation involved unleashing on the oil market over five million barrels a day of excess reserve production that were held back by a few usual suspects, plus derivative manipulation at the NYMEX, crashing the price.

Then, the derivative manipulation of the ruble crashed the currency. Almost all imports to Russia were virtually blocked – as oil and natural gas exports remained constant. In the long run though, this should create a significant balance of trade surplus for Russia; a very positive factor for long-term growth of Russia’s domestic industry.

Vladimir Yakunin, the former head of Russian Railways, now out due to a reshuffle, recently told AP in no uncertain terms how the aim of US sanctions was to cut off Russia economically from Europe.

Sanctions, coupled with speculation on oil and the ruble, pushed the Russian economy into recession in

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SECOND

Monday, September 21, 2015 4:05 AM

Quote:
Originally posted by SIGNYM:
Neo-Tsarism, anyone?

One might be tempted to see Glazyev drawing up plans to return to some sort of Tsarist self-sufficiency while cutting off ties with the West. Assuming some version of that would be approved by the Kremlin, what’s certain is that it may turn into a huge blow the EU might not recover from.

Imagine Russia defaulting on all its foreign debt - over $700 billion – on which Western sanctions have raised extra, punitive costs in terms of repayment.

The default would be payback for the twin Western manipulation of oil prices and the ruble. The manipulation involved unleashing on the oil market over five million barrels a day of excess reserve production that were held back by a few usual suspects, plus derivative manipulation at the NYMEX, crashing the price.

Russia's foreign debt – over $700 billion – is not so big when you know that US banks have $2.5 trillion (!) of excess reserves.
https://research.stlouisfed.org/fred2/graph/?id=EXCSRESNS

Somebody will get hurt by that $700 billion loss: the fools that loaned money to Russia. Too bad, but those fools deserve to be bankrupted.

What Putin will really hurt is Russian imports from the West if he does this. He is under the delusion that numbers in a bank account can destroy the West. Not everything is about accounts balancing. So, my advice to Putin is go right ahead and place the gun in your mouth and pull the trigger until you have killed Russia. Make my day, Putin, because ruining Russia will be wonderful for Texas oil and gas.

SECOND

Thursday, October 8, 2015 9:05 PM

The China Debt Fizzle; Oct 8, 2015 10:01 am
http://krugman.blogs.nytimes.com/2015/10/08/the-china-debt-fizzle/
My opinion is the most important sentence in the article is the last one: “And of course those who got this completely wrong have learned nothing from the experience.”

Quote:
Remember the dire threat posed by our financial dependence on China? A few years ago it was all over the media, generally stated not as a hypothesis but as a fact. Obviously, terrible things would happen if China stopped buying our debt, or worse yet, started to sell off its holdings. Interest rates would soar and the U.S economy would plunge, right? Indeed, that great monetary expert Admiral Mullen was widely quoted as declaring that debt was our biggest security threat. Anyone who suggested that we didn’t actually need to worry about a China sell off was considered weird and irresponsible.

Well, don’t tell anyone, but the much-feared event is happening now. As China tries to prop up the yuan in the face of capital flight, it’s selling lots of U.S. debt; so are other emerging markets. And the effect on U.S. interest rates so far has been … nothing.

Who could have predicted such a thing? Well, me. And not just me: anyone who seriously thought through the economics of the situation, with the world awash in excess saving and the U.S. in a liquidity trap, quickly realized that the whole China-debt scare story was nonsense. But as I said, this wasn’t even reported as a debate; the threat of Chinese debt holdings was reported as fact.

And of course those who got this completely wrong have learned nothing from the experience.

In the article Did The Fed Save The World? there is another reminder that we are ruled by leaders who can't learn.
http://krugman.blogs.nytimes.com/2015/10/07/did-the-fed-save-the-world/
My opinion is the most important paragraph in the article is the last one: “Oh, and since 2010 officials everywhere, but especially in Europe, have been doing all they can to undo the favorable effects of automatic stabilizers. And the result is that in Europe economic performance is at this point considerably worse than it was at this point in the 1930s.”

Changing direction means tacitly admitting to mistakes. Admitting to making mistakes is politically difficult, so why do it?

SIGNYM

Sunday, November 15, 2015 9:38 PM

So, been watching this for a while, and I see a pattern. While Russia has been distracting the USA with its military activities, China has been busy in the background creating alternatives to western-dominated exchanges and to the petrodollar:

INTERBANK EXCHANGE
Most international transactions take place using the SWIFT.

Quote:
SWIFT is a cooperative society under Belgian law owned by its member financial institutions with offices around the world. SWIFT headquarters, designed by Ricardo Bofill Taller de Arquitectura are in La Hulpe, Belgium, near Brussels. The chairman of SWIFT is Yawar Shah originally from Pakistan, and its CEO is Gottfried Leibbrandt, originally from the Netherlands.SWIFT hosts an annual conference every year, called SIBOS, specifically aimed at the financial services industry

It is both hardware and software communication standards linking 9000 institutions around the world. However, SWIFT has been threatened as a political tool against Russia; China is developing a SWIFT alternative which was due to come online sometime in December.
https://www.rt.com/business/239189-china-payment-system-ready/

PETROLEUM EXCHANGE

Quote:
SINGAPORE, Sept 2 China may launch a global crude oil futures contract as early as October to compete with the existing London Brent and the U.S. WTI benchmarks, three sources said, as it pushes ahead with reforms to open up its oil markets. The long-awaited crude contract would better reflect China's growing importance in setting crude prices, as well as boost the use of the yuan in which it will be traded, although volatile global trading conditions and China's recent interference in stock markets have raised some concerns. The Shanghai International Energy Exchange, also known as INE, circulated a draft of the futures contract to market participants last month, saying the launch could happen as early as October, the sources who saw the draft, told Reuters.

This exchange does not appear to be active yet. Maybe it's been waiting on ...

CHINESE YUAN SPECIAL DRAWING RIGHTS (SDR) WITH THE IMF

Quote:
China's yuan takes leap toward joining IMF currency basket
China's yuan moved closer to joining other top global currencies in the International Monetary Fund's benchmark foreign exchange basket on Friday after Fund staff and IMF chief Christine Lagarde gave the move the thumbs up.

The recommendation paves the way for the Fund's executive board, which has the final say, to place the yuan CNY=CFXS CNY= on a par with the U.S. dollar .DXY, Japanese yen JPY=, British pound GBP= and euro EUR= at a meeting scheduled for Nov. 30.

http://www.reuters.com/article/2015/11/14/us-imf-china-yuan-idUSKCN0T2
2OC20151114

CHINA (SHANGHAI) GOLD EXCHANGE
Also recently set up, THIS exchange specializes in yuan-denominated, physically deliverable gold, as opposed to the futures contracts ("paper gold") specialized in by COMEX and London. Too many links to even try citing, here's one.
http://www.silverdoctors.com/two-week-shanghai-gold-exchange-withdrawa
ls-exceed-all-2014-comex-deliveries/

INTERNATIONAL DEVELOPMENT BANKS
China started the AIIB, which attracted quite a few foreign investors despite the USA's attempts to keep them out. Australia, Germany, UK, and other western "partners" eagerly jumped on board for an oppty to invest in Asia development. There is also the BRICS bank, a smaller effort funded by the BRICS nations. Together, these banks could provide an alternative source of loans instead of the IMF and World Bank.

COMPLETE PACKAGE
China is quickly creating a complete alternative to the USA petrodollar and western-dominated banks. Thinking about how dollars are exchanged (SWIFT) and what it is used for (exchange, store of wealth, investment) I can't think of any function that the Chinese have left out.

BUT ...
China has some serious restructuring to do. When demand for their products collapsed in 2008, the Chinese leadership realized that they could not depend on an export-based econo

SECOND

Monday, November 16, 2015 9:26 AM

If you need more worry: shadow banking in U.S. accounts for 82% of U.S. gross domestic product.
www.marketwatch.com/story/us-is-home-to-40-of-global-shadow-banking-as
sets-2015-11-13

Shadow banking refers to financial institutions that operate outside of regulatory jurisdiction. They are widely viewed as risky as they are unable to rely on regulatory support during times of financial uncertainty. Shadow banks were blamed by the International Monetary Fund for contributing to the global financial crisis in 2008.

http://heroforpain.deviantart.com/art/Grumpy-Cobb-466182779

The Joss Whedon script for Serenity, where Wash lives, is Serenity-190pages.pdf at www.mediafire.com/folder/1uwh75oa407q8/Firefly

1KIKI

Monday, November 16, 2015 9:44 AM

http://www.investinganswers.com/financial-dictionary/businesses-corpor
ations/shadow-banking-system-2190

The shadow banking system (or shadow financial system) is a network of financial institutions comprised of non-depository banks -- e.g., investment banks*, structured investment vehicles (SIVs), conduits, hedge funds, non-bank financial institutions and money market funds.

* however, since the US no longer forbids depository banks from being investment banks as well, it seems to me that many savings banks belong to the shadow banking economy.

SAGAN: We are releasing vast quantities of carbon dioxide, increasing the greenhouse effect. It may not take much to destabilize the Earth's climate, to convert this heaven, our only home in the cosmos, into a kind of hell.

SECOND

Monday, November 16, 2015 6:47 PM

Quote:
Originally posted by 1kiki:

* however, since the US no longer forbids depository banks from being investment banks as well, it seems to me that many savings banks belong to the shadow banking economy.

"It is worse than you know."

Quote:
Based on a new methodology for assessing non-bank financial entities and activities by “economic functions” introduced this year, the narrow measure of global shadow banking that may pose financial stability risks amounted to $36 trillion in 2014 for the 26 participating jurisdictions. This is equivalent to 59% of GDP of participating jurisdictions, and 12% of financial system assets, and has grown moderately over the past several years.

The new classification by economic functions shows that credit intermediation associated with collective investment vehicles with features that make them susceptible to runs (e.g. money market funds (MMFs), hedge funds and other investment funds) represents 60% of the narrow measure of shadow banking. It has grown more than 10% (per year) on average over the past four years. By contrast, the level of securitisation-based credit intermediation – among the key contributors to the financial crisis – has fallen in recent years.

www.financialstabilityboard.org/wp-content/uploads/global-shadow-banki
ng-monitoring-report-2015.pdf

"Where are you hiding, little shadow bank?" - The Operative and River
http://fireflyfans.net/bluesun.aspx?bid=6619

The Joss Whedon script for Serenity, where Wash lives, is Serenity-190pages.pdf at www.mediafire.com/folder/1uwh75oa407q8/Firefly

JAYNEZTOWN

Monday, March 13, 2023 8:18 PM

Forex

https://finviz.com/forex.ashx

Video
its a mainstream media broadcast so I don't think u tube would pull it, if they do censor then hopefully clips are also found on rumble, bitchute or other platforms

Janet Yellen

6IXSTRINGJACK

Tuesday, March 14, 2023 5:18 AM

Quote:
Originally posted by JAYNEZTOWN:
its a mainstream media broadcast so I don't think u tube would pull it, if they do censor then hopefully clips are also found on rumble, bitchute or other platforms

A lot of news outlets pull their own shit after a day or two. If it ends up gone it might not have been censorship.

--------------------------------------------------

Growing up in a Republic was nice... Shame we couldn't keep it.

JAYNEZTOWN

Saturday, May 13, 2023 12:29 AM

Dollar’s rule facing many mutinies, a likely credible one from BRICS

https://www.thestatesman.com/business/dollars-rule-facing-many-mutinie
s-a-likely-credible-one-from-brics-1503178696.html

JAYNEZTOWN

Tuesday, July 11, 2023 9:02 PM

Federal debt explodes

https://news.yahoo.com/federal-debt-explodes-1-trillion-173820940.html

THG

Tuesday, July 11, 2023 9:07 PM

Quote:
Originally posted by SIGNYM:

But I have no idea what the hell it means.

Sorry for the teaser, but one of my buddies has been pointing out this trend for the past six months, insisting that It's important! but for some reason, altho I see that it's happening, I can't figure out what it means:

So comrade, how's that Ruble doing?

T

THG

Tuesday, July 11, 2023 9:13 PM

Quote:
Originally posted by JAYNEZTOWN:

Federal debt explodes

https://news.yahoo.com/federal-debt-explodes-1-trillion-173820940.html]

The national debt under President Trump increased from $20,244,900,016,053 to $27,751,896,236,415 (20th January 2021). [13] That's $5.138 billion a day.

https://www.self.inc/info/us-debt-under-trump/

Now, if we could just rescind that trillion dollar a year tax cut to the top one percent Trump ok'd, things would be looking up. Unfortunately, the Republicans keep blocking that.

Yet the are against school lunches for all.

T

JAYNEZTOWN

Tuesday, May 28, 2024 6:41 PM

Joe Biden: Rebuilder of the US economy or dangerous spendthrift?

https://www.lemonde.fr/en/economy/article/2024/05/28/joe-biden-rebuild
er-of-the-us-economy-or-dangerous-spendthrift_6672892_19.html

JAYNEZTOWN

Wednesday, August 26, 2026 12:49 AM

Trump Threatens to Rename Lake Ontario as Trade War With Canada Heats Up

https://www.nytimes.com/2026/08/25/us/politics/trump-lake-ontario-amer
ica-canada-trade.html

How The Country With the Most Gold Stole It From...