http://www.gold-eagle.com/article/grandmaster-putins-golden-trap
Very few people understand what Putin is doing at the
moment. And almost no one understands what he will do in the
future.
No matter how strange it may seem, but right now, Putin is
selling Russian oil and gas only for physical gold.
Putin is not shouting about it all over the world. And of course, he
still accepts US dollars as an intermediate means of payment. But
he immediately exchanges all these dollars obtained from the sale of
oil and gas for physical gold!
To understand this, it is enough to look at the dynamics of growth of
gold reserves of Russia and to compare this data with foreign exchange
earnings of the RF coming from the sale of oil and gas over the same
period.
Moreover, in the third quarter the purchases by Russia of physical
gold are at an all-time high, record levels. In the third quarter of
this year, Russia had purchased an incredible amount of gold in the amount
of 55 tons. It’s more than all the central banks of all
countries of the world combined (according to official data)!
In total, the central banks of all countries of the world have purchased
93 tons of the precious metal in the third quarter of 2014. It was the 15th
consecutive quarter of net purchases of gold by Central banks. Of the 93
tonnes of gold purchases by central banks around the world during this
period, the staggering volume of purchases – of 55 tons –
belongs to Russia.
Not so long ago, British scientists have successfully come to the same
conclusion, as was published in the Conclusion of the U.S. Geological
survey a few years ago. Namely: Europe will not be able to survive without
energy supply from Russia. Translated from English to any other language in
the world it means: “The world will not be able to survive if oil
and gas from Russia is subtracted from the global balance of energy
supply”.
Thus, the Western world, built on the hegemony of the petrodollar,
is in a catastrophic situation. In which it cannot survive without oil
and gas supplies from Russia. And Russia is now ready to sell its oil
and gas to the West only in exchange for physical gold! The
twist of Putin’s game is that the mechanism for the
sale of Russian energy to the West only for gold now works
regardless of whether the West agrees to pay for Russian oil and
gas with its artificially cheap gold, or not.
Since Russia has a constant flow of dollars from the sale of oil
and gas, it will be able to convert these dollars to buy gold at current
gold prices, depressed by all means by the West. This equates gold price,
which had been artificially and meticulously lowered by the Fed and
ESF many time...via artificially inflated purchasing power of the dollar
through market manipulation.
Interesting fact: The suppression of gold prices
by the special department of US Government – ESF (Exchange
Stabilization Fund) – with the aim of stabilizing the dollar has been
made into a law in the United States.
In the financial world it is (generally) accepted as a given that gold
is anti-dollar...i.e. the gold price runs inverse to value of the
dollar.
- In 1971, US
President Richard Nixon closed the ‘gold
window’, ending the free exchange of dollars for gold,
guaranteed by the US in 1944 at Bretton Woods.
- In 2014, Russian
President Vladimir Putin has reopened the ‘gold window’,
without asking Washington’s permission.
Right now the West spends much of its efforts and resources to
suppress the prices of gold and oil. Thereby, on the one hand to
distort the existing economic reality in favor of the US dollar ...and on
the other hand, to destroy the Russian economy, refusing to play the role
of obedient vassal of the West.
Today assets such as gold and oil look proportionally weakened and
excessively undervalued against the US dollar. It is a consequence of the
enormous economic effort on the part of the West.
And now Putin sells Russian energy resources in exchange for these US
dollars, artificially propped by the efforts of the West. With these dollar
proceeds Putin immediately buys gold, artificially devalued against
the U.S. dollar by the efforts of the West itself!
There is another interesting element in Putin’s game. It’s Russian
uranium. Every sixth light bulb in the USA depends on its supply,
which Russia sells to the US too...for dollars.
Thus, in exchange for Russian oil, gas and uranium, the West pays Russia
with dollars, purchasing power of which is artificially inflated against
oil and gold by the efforts (manipulations) of the West.
However, Putin uses these dollars only to withdraw physical gold from
the West in exchange at a price denominated in US dollars, artificially lowered by
the same West.
This truly brilliant economic combination
by Putin puts the West led by the United States in a position of a
snake, aggressively and diligently devouring its own tail.
The idea of this economic golden trap for the West is probably not
authored by Putin himself. Most likely it was the idea of Putin’s
Advisor for Economic Affairs – Dr. Sergey Glazyev. Otherwise,
why seemingly not involved in business bureaucrat Glazyev, along
with many Russian businessmen, was personally included by Washington on the
sanction list? The idea of an economist, Dr. Glazyev was
brilliantly executed by Putin...but with full endorsement from his
Chinese colleague – XI Jinping.
Especially interesting in this context looks the November statement of
the first Deputy Chairman of Central Bank of Russia Ksenia Yudaeva, which
stressed that the CBR can use the gold from its reserves to pay for
imports, if need be. It is obvious that in terms of sanctions by the
Western world, this statement is addressed to the BRICS countries,
and first of all China. For China, Russia’s willingness to pay for
goods with Western gold is very convenient. And here’s why:
China recently announced that it will cease to increase its gold
and currency reserves denominated in US dollars. Considering
the growing trade deficit between the US and China (the current difference
is five times in favor of China), then this statement translated from
the financial language reads: “China stops selling their
goods for dollars”. The world’s media chose not to
notice this grandest in the recent monetary historic event . The
issue is not that China literally refuses to sell its goods for US
dollars. China, of course, will continue to accept US dollars as an
intermediate means of payment for its goods. But, having taken dollars,
China will immediately get rid of them and replace with something else
in the structure of its gold and currency reserves. Otherwise the
statement made by the monetary authorities of China loses its
meaning: “We are stopping the increase of our gold and currency
reserves, denominated in US dollars.” That is, China will
no longer buy United States Treasury bonds for dollars
earned from trade with any countries, as they did this before.
Thus, China will replace all the dollars that it will receive for its
goods not only from the US but from all over the world with something
else not to increase their gold currency reserves,
denominated in US dollars. And here is an interesting question: what will
China replace all the trade dollars with? What currency or an
asset? Analysis of the current monetary policy of China shows that
most likely the dollars coming from trade, or a substantial chunk of
them, China will quietly replace and de facto is already replacing
with Gold.
In this aspect, the solitaire of Russian-Chinese relations is extremely
successful for Moscow and Beijing. Russia buys goods from China directly
for gold at its current price. While China buys Russian energy resources
for gold at its current price. At this Russian-Chinese festival of
life there is a place for everything: Chinese goods, Russian energy
resources, and gold – as a means of mutual payment. Only the US
dollar has no place at this festival of life. And this is not
surprising. Because the US dollar is not a Chinese product, nor
a Russian energy resource. It is only an intermediate financial
instrument of settlement – and an unnecessary intermediary. And it is
customary to exclude unnecessary intermediaries from the interaction of two
independent business partners.
It should be noted separately that the global market for physical gold
is extremely small relative to the world market for physical oil supplies.
And especially the world market for physical gold is microscopic
compared to the entirety of world markets for physical delivery of
oil, gas, uranium and goods.
Emphasis on the phrase “physical gold” is made because in exchange for
its physical, not ‘paper’ energy resources, Russia is now withdrawing gold
from the West, but only in its physical, not paper form.
China accomplishes this by acquiring from the West the artificially devalued
physical gold as a payment for physical delivery of real products to
the West.
The West hopes that Russia and China will accept as payment for their
energy resources and goods...the “shitcoin” or so-called “paper gold” of
various kinds also did not materialize. Russia and China are only
interested in real gold and only the physical metal as a final means of
payment.
For reference: the turnover of the market of paper gold, only of gold
futures, is estimated at $360 billion per month. But physical delivery of
gold is only for $280 million a month. This equates to a ratio
of trade of paper gold versus physical gold to 1000 to 1.
Using the mechanism of active withdrawal from the market of one
artificially lowered by the West financial asset (gold) in exchange for
another artificially inflated by the West financial asset (USD), Putin
has thereby started the countdown to the end of the world hegemony of
petrodollar. Thus, Putin has put the West in a deadlock of the absence
of any positive economic prospects.
The West can spend as much of its efforts and resources to
artificially increase the purchasing power of the dollar, lower oil prices
and artificially lower the purchasing power of gold. The problem of
the West is that the stocks of physical gold in possession of the West are
not unlimited. Therefore, the more the West devalues oil and gold against
the US dollar, the faster it loses devaluing Gold from its not infinite
reserves.
In this brilliantly played by Putin economic combination, physical
gold from the reserves of the West is rapidly flowing to Russia, China,
Brazil, Kazakhstan and India (i.e. the BRICS countries). At the
current rate of reduction of reserves of physical gold, the West
simply does not have the time to do anything against Putin’s Russia until
the collapse of the entire Western petrodollar world. In
chess the situation in which Putin has put the West, led by the US, is
called “time trouble”.
The Western world has never faced such economic events and phenomena
that are happening right now. The former USSR rapidly sold gold
during the fall of oil prices. Today, Russia rapidly buys
gold during the fall in oil prices. Thus, Russia poses a real
threat to the American model of petrodollar world domination.
The main principle of world petrodollar model is allowing
Western countries led by the United States to live at the expense of the
labor and resources of other countries...based on the role of the US
currency, dominant in the global monetary system (GMS) . The role of
the US dollar in the GMS is that it is the ultimate means of payment.
This means that the national currency of the United States in the structure
of the GMS is the ultimate asset accumulator, to exchange which to any
other asset does not make sense.
Led by Russia and China, what the BRICS are doing now is actually
changing the role and status of the US dollar in the global monetary
system. From the ultimate means of payment and asset accumulation, the
national currency of the USA, by the joint actions of Moscow and Beijing
is turned into only an intermediate means of payment. Intended
only to exchange this interim payment for another and the
ultimate financial asset – gold. Thus, the US dollar actually loses its
role as the ultimate means of payment and asset accumulation, yielding both
of those roles to another recognized, denationalized and depoliticized
monetary asset – GOLD!
Traditionally, the West has used two methods to eliminate the threat to
the hegemony of petrodollar model in the world and the consequent excessive
privileges for the West:
One of these methods – colored revolutions. The second method, which is
usually applied by the West, if the first fails – military
aggression and bombing.
But in Russia’s case both of these methods are either
impossible or unacceptable for the West.
Because, firstly, the population of Russia, unlike people in many other
countries, does not wish to exchange their freedom and the future of their
children for Western kielbasa (meat sausage). This is evident from the
record ratings of Putin, regularly published by the leading Western
rating agencies. Personal friendship of Washington protégé Navalny with
Senator McCain played for him and Washington a very negative role. Having
learned this fact from the media, 98% of the Russian population now
perceive Navalny only as a vassal of Washington and a traitor to Russia’s
national interests. Therefore Western professionals, who have not yet lost
their mind, cannot dream about any color revolution in Russia.
As for the second traditional Western way of direct military aggression,
Russia is certainly not Yugoslavia, not Iraq nor Libya. In any
non-nuclear military operation against Russia, in the territory of Russia,
the West led by the US is doomed to defeat. And the generals in the
Pentagon exercising real leadership of NATO forces are aware of this.
Similarly hopeless is a nuclear war against Russia, including the concept
of so-called “preventive disarming nuclear strike”. NATO is simply
not technically able to strike a blow that would completely disarm the
nuclear potential of Russia in all its many manifestations. A massive
nuclear retaliatory strike on the enemy or a pool of enemies would be
inevitable. And its total capacity will be enough for survivors to envy
the dead. That is, an exchange of nuclear strikes with a country like
Russia is not a solution to the looming problem of the collapse of a
petrodollar world. It is in the best case, a final chord and the last point
in the history of its existence. In the worst case – a nuclear winter
and the demise of all life on the planet, except for the
bacteria mutated from radiation.
The Western economic establishment can see and understand the essence of
the situation. Leading Western economists are certainly aware of the severity
of the predicament and hopelessness of the situation the Western world
finds itself in, in Putin’s economic gold trap. After all, since the
Bretton Woods agreements, we all know the Golden rule: “Who has
more gold sets the rules.” But everyone in the West is silent
about it. Silent because no one knows now how to get out of this situation.
If you explain to the Western public all the details of the looming
economic disaster, the public will ask the supporters of a petrodollar
world the most horrific questions, which will sound like this:
– How long will the West be able to buy oil and gas
from Russia in exchange for physical gold?
-And what will happen to the US petrodollar after the West runs out
of physical gold to pay for Russian oil, gas and uranium, as
well as to pay for Chinese goods?
No one in the west today can answer these seemingly simple
questions.
And this is called “Checkmate”, ladies and gentlemen. The game
is over.
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1 comment:
This story is ridiculous when you consider the fact that the US does not buy oil from Russia. Actually, we don't NEED to buy oil from anyone.
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