Category China’s CIPS replaces SWIFT

May 19 2024

China Dumping US Debt At Record Levels


Posted originally on May 18, 2024 By Martin Armstrong 

Central_Bank_China

As I have been warning, these STUPID Neocons threatening the world have ZERO respect for the American people or our economy. Threatening China when they are the largest holder of US debt is braindead. As I have said, China would be stupid if they did not start to dump every penny of US debt because when these Neocons start a war, they will default on all debt held by foreign enemies, which they define as anyone who opposes their commands.

US debt to China Buy Bullets

CHINA sold a record amount of Treasury and US agency bonds in the first quarter, highlighting the Asian nation’s move to exit the US debt market thanks to war. Beijing dumped a total of US$53.3 billion of Treasuries and agency bonds combined in the first quarter, based on Bloomberg calculations of the latest data from the US Department of the Treasury. Belgium, often seen as a custodian of China’s holdings, disposed of US$22 billion of Treasuries during the period.

An people expect interest rates to decline?

May 15 2024

Joe Biden Announces Tariffs on Non-Existent Products from Non-Existent Origination Country – Here’s Why


Posted originally on the CTH on May 14, 2024 | Sundance

BlackRock investment firm writes the regulatory and economic policy for Joe Biden’s administration. That’s the quid-pro-quo that maintains the Biden political financial operation. All of DC know it. No one does not know. The one’s who claim they do not know about it are all pretending. Republicans take the background BlackRock bribes and pretend.

BlackRock positioned massive investment assets inside Chinese auto manufacturers, MG, BYD, and Chery. The three Chinese companies are in the process of moving North American auto manufacturing to Mexico, specifically to make EV’s. The Chinese EV’s made in Mexico will come into the U.S market tariff free under the USMCA trade agreement. China and BlackRock will make billions.

Today Joe Biden announced a series of tariffs against China in the EV industry. [SEE HERE] The Chinese EV’s are not being made in China. The tariff regime is a farce a total joke.

Biden might as well be announcing tariffs on Chinese swimming pools flown into the USA via hot air balloon.  There will be more Chinese swimming pools delivered from China than Chinese EV’s.  The Chinese EV’s come from Mexico.  The tariff is fake.

WHITE HOUSE […] To further encourage China to eliminate the acts, policies, and practices at issue, and to counteract the burden or restriction of these acts, policies, and practices, the Trade Representative shall modify the two actions to increase section 301 ad valorem rates of duty for the following products from China:

  • Battery parts (non-lithium-ion batteries):  Increase rate to 25 percent in 2024;
  • Electric vehicles:  Increase rate to 100 percent in 2024;
  • Lithium-ion electrical vehicle batteries:  Increase rate to 25 percent in 2024;
  • Lithium-ion non-electrical vehicle batteries:  Increase rate to 25 percent in 2026;
  • Natural graphite:  Increase rate to 25 percent in 2026;
  • Other critical minerals:  Increase rate to 25 percent in 2024; (read more)

.

None of this stuff is coming from China.  It is all coming from Mexico via transnational shipping and Chinese manufacturing in Mexico. [Check Date]

On the EV issue, this tariff approach is politically duplicitous by Biden against the backdrop of massive investment in Mexico by the three largest Chinese EV automakers. Last December the three Chinese auto manufacturers, MG, BYD, and Chery, announced they were going to spend billions building new EV manufacturing plants in Mexico.  Each Chinese auto manufacturer was going to spend between $1.5 to $2.0 billion.

Those Mexican built Chinese EV’s would pass into the USA market under current USMCA trade rules and regulations, as long as they technically meet the material origination rules.  This can make tariffs against the Chinese imported EVs a moot point, because China will be making them in Mexico (North American trade agreement).

One of the reasons President Trump said the U.S. auto industry would suffer a “bloodbath,” is specifically because the current Chinese auto companies are targeting these EV’s in the $10,000 or less range.  If you want to see what it looks like when cheap Chinese EV’s start to flood a consumer market, visit Russia – the western sanctions have only increased this flow.  I can see it clear as day.

China plans to pump out thousands of cheap, what I would consider semi-disposable, electric cars into the USA market. That’s why they have invested so heavily in Mexico.  Keep in mind, Blackrock (a Biden benefactor investment firm) is enmeshed with this Chinese move.

This tariff claim by the Biden administration on “import Chinese EV’s” is optics only for political benefit.  Whereas the 100% tariffs proposed by Donald Trump specifically target Chinese EV’s made in Mexico.

Stand back and elevate your thinking on this Chinese EV issue; the substance of it is a consequence of a much larger dynamic.  It is somewhat of a self-fulfilling prophecy.

There is a cleaving underway, a dedollarization that continues in global trade.  Nations are no longer relying (dependent) on dollars as the baseline for trade parity; they are determining their own nation to nation trade valuations outside the use of the dollar as a benchmark.

The result of this dedollarization taking place is massive inflation inside the USA that continues as the dollar (yellow zone) is weakened against the increasingly non-dollar-aligned world (grey zone).  The frequency of dollar use is lessening as alternatives are being used.

Trade into the yellow zone still requires a benchmark of dollars, but bilateral trade within the grey zone increasingly does not.  This is the root of the global financial and economic cleaving.  Mexico is not stupid.

China is trying to position their transportation sector (auto, planes, trains and mass transit manufacturing) as Apple manufacturing is to cell phone use.  Some of these disposable Chinese electric vehicles are actually impressive, which makes sense when you consider that China steals the engineering and design elements from knuckleheaded western corporations who use China for industrial manufacturing (see Tesla etc).

Nov 17 2023

China Extends Olive Branch to US Re-Posted Nov 17, 2023 By Martin Armstrong 


China US Trade War

The Asia-Pacific Economic Cooperation (APEC) summit concluded with China and the US agreeing to partner on trade military strategy. The love-hate relationship between America and its largest trading partner has been strained for may years and completely counterproductive. China’s President Xi Jinping made it clear to Biden that the US is either for or against them.

“If we regard each other as the biggest rival, the most significant geopolitical challenge and an ever-pressing threat, it will inevitably lead to wrong policies, wrong actions and wrong results,” Xi explained. “China is willing to be a partner and friend of the United States.”

America’s leader, sadly, appeared utterly incapable of having a conversation with Xi. In an embarrassing chain of events, Joe Biden managed to anger China by once again referring to Xi as a dictator. “He’s a dictator in the sense that he is a guy who runs a country… based on a form of government that is totally different from ours,” the man who received the most votes in US history stated. Chinese media has not reported Biden’s comments, and Xi has agreed to send US zoos giant pandas to appease the mindless masses like our president.

The real question remains – can the US stay away from Taiwan? Xi called the issue “the biggest, most dangerous issue in US-China ties,” as the neocons have been extremely vocal about their willingness to defend Taiwan. “China has never bet on the United States to lose, has never intervened in US internal affairs and does not intend to challenge or replace the US. China is happy to see a confident, open and prosperous US,” Xi stated, making it clear that China is focused on advancing economically and not going to war with America.

China’s willingness to partner with the US correlates with its current economy. Foreign investment into China fell to negative territory for the first time since 1998. Now, Chinese leaders want to put differences aside and work with America’s private sector. China has been attempting to mirror America’s business economy since 1978 and embark on a path of capitalistic consumerism.

Every promise will fall to the wayside if the US does not respect the One China policy in regard to Taiwan. China cares not about its other allies and their ongoing wars at the end of the day. Taiwan is the key piece that could make or break US-China relations for generations to come.

Jul 31 2023

Can Cryptocurrencies Survive in an Authoritarian World?


Armstrong Economics Blog/Cryptocurrency Re-Posted Jul 31, 2023 by Martin Armstrong

QUESTION: Thanks for all the great information you share. I have a question regarding cryptocurrencies. Do you think all countries will try to abolish crypto or only certain countries (such as the US) in favor of a central bank digital currency? As of now, many countries appear much more accepting of crypto than the US. Thanks again.

JWM

ANSWER: This is a good question. Before the stupid sanctions imposed on Russia removed them from SWIFT, the IMF would threaten tax havens that if they did not turn over the people with accounts in their country, they would be removed from SWIFT. The sanction against Russia have backfired, so now we have China and Iran setting up their alternatives to SWIFT. I would have assumed that they would have threatened countries against the removal from SWIFT if they did not shut down cryptocurrencies, for they would provide an alternative to CBDC and thereby skirt their end goal of 100% control and taxation. In trying to sanction Russia, they have lost their absolute power to abuse SWIFT to threaten countries. Theoretically, the tax havens could switch to China’s CIPS and say screw you to the US and EU.

As I have said, an EMP could wipe out the entire financial system and neutralize even nuclear weapons capability. I do not see how these people will succeed in dominating the world. Their abuse of SWIFT to punish Russia has undermined their power and the entire world economy. This is most likely part of the 2032 collapse.

I would be concerned about cryptocurrencies making the transition to what lies beyond 2032. That is highly speculative. I would tend to rely on the tangle assets to make the transition to whatever the new monetary system will emerge post-2032.