NATO Secretary-General Jens Stoltenberg confirmed that there would be a global world war on Friday when he announced that Ukraine will be invited to join NATO. Stoltenberg, who recently took a trip to Ukraine to show his full support, said that Ukraine will be permitted to join after the war ends. Zelensky is begging for NATO to permit Ukraine to join NATO immediately.
At a joint news conference in Kyiv, Zelensky and Stoltenberg spoke on NATO’s unwavering support for Ukraine. “Over the years, NATO Allies have provided training for tens of thousands of Ukrainian soldiers. And since last February, NATO Allies have delivered more than 150 billion euros of support, including 65 billion euros of military aid,” Stoltenberg said. “Let me be clear: Ukraine’s rightful place is in the Euro-Atlantic family. Ukraine’s rightful place is in NATO. And over time, our support will help you make this possible.” He said their approach will take multiple years to “ensure full interoperability with the Alliance.”
Stoltenberg went on to explain why NATO was helping an unaffiliated nation. He hit on every trick in the book, from it being “morally right” to demonizing the head of state (Putin) as if removing him could solve this crisis:
“I expect the NATO Allies to do so both because it’s the morally right thing to do. A sovereign independent nation in Europe, Ukraine has been attacked, as a victim of a brutal war of aggression and therefore it's Ukraine's right to defend itself and it's our right to support Ukraine in upholding the right of self defense, a right which is enshrined in the UN Charter but it's also in our self-interest. Because if President Putin wins it will make the world more dangerous and us more vulnerable, because then the message is that when authoritarian powers, like Russia, like President Putin uses forces, they get what they want. So it's in our security interest, it's in the security interest of NATO Allies to support Ukraine.”
Zelensky said, per usual, that the efforts of the West have not been enough. “There is not a single objective barrier to the political decision to invite Ukraine into the alliance and now, when most people in NATO countries and the majority of Ukrainians support NATO accession, is the time for the corresponding decisions,” the comedian who is running a country said.
If Ukraine joins NATO, World War III will begin immediately. Stoltenberg is buying time, as they did with the fake Minsk Agreements. NATO is afraid that Hungary and Turkey will turn away from the alliance if Ukraine is openly admitted. The comment section on the video I posted above shows how the public does not understand what is happening. People are cheering and saying Zelensky should win the Nobel PEACE Prize when he has turned down every olive branch Moscow attempted to extend. All these people want is war and they think of nothing else. Ukraine is nothing more than cannon fodder to them and the latest plot for the neocons to conquer Russia.
All we hear is the same claims that the dollar is dead and it will be totally worthless any day now. Over the last few weeks, all we hear from the majority now is that the dollar is finished. Virtually every page you turn or site you visit claims the death of the dollar. They are calling this the de-dollarization of the world economy and that the future of the US dollar as well as the American empire itself is now collapsing. The general claim is that the group of economically-aligned nations known collectively as BRICS is a major threat to the greenback. That was the same story we heard about the Euro back in 1997.
As their scenario goes, the BRICS [Brazil, Russia, India, China, and South Africa] have moved to form an anti-dollar colation and Saudi Arabia is considering jumping on board. They insist that once that happens, the “petrodollar” will die and cease to be a reserve currency.
This is then followed by the forecast that the economy will suffer and that any bounce in exports will be short-lived simply because the dollar will be dead for the long term. Of course, this has been the favorite forecast that they keep putting out since Bretton Woods collapsed. They were wrong back then for the dollar rose between 1972 and 1976 against the British pound, with the collapse of Bretton Woods. To try to explain why the dollar did not collapse, that is when they claimed that the dollar was backed now by oil rather than gold. That was just an excuse as always to cover up their wrong forecast.
They sold that story to Newsweek and now the dollar rally was because of oil which replace gold. Suddenly the dollar became de facto backed by oil. They needed an explanation to explain why all the old theories were wrong. They sold this theory and it made the front cover of Newsweek. Everyone said YES! That must be the reason. OPEC priced oil in dollars! Naturally, everything was priced in dollars because, under the fixed exchange rate of Bretton Woods, everything from wheat and corn to copper and gold was all priced in dollars.
Now they are saying the American empire is threatened by the potential commercial real estate collapse and the BRICS anti-dollar venture. So they are forecasting a great depression-style crash is possible in the not-too-distant future. They spin this to forecast the end of the America Empire. The London FT, always anti-American/Pro WEF, reports that the dollar as a reserve currency has declined from 73% in 2001 to around 55% by 2021. Yet the FT did state an obvious fact:
“But if you are a reserve-rich central bank elsewhere that isn’t going to be a lot of comfort. Moreover, would you really feel more comfortable in, say, the renminbi? Even if it was fully convertible and liquid, would you honestly feel more sure that Beijing will behave lawfully than DC? The dollar still looks like the proverbial least dirty shirt in the closet.”
COVID actually has played a major role in shifting the world economy. In 2020, the US economy was 24.75% of the world’s GDP. By the start of 2022, it had fallen marginally to 24.15%. What these dollar-forecasting jockeys do not understand, is that if they were correct and the dollar collapsed, then the very BRICS would collapse even further. Economically speaking, when the United States gets a head cold, the rest of the world catches ammonia. You can’t have it both ways. The strength of the dollar is not gold or oil, it is the American consumer.
The risk to the entire world is runaway inflation thanks to Biden pouring untold amounts of money into the black hole known as Ukraine. The Neocons, who control Biden, are planning to launch a war against Russia and China before 2024. This will only continue to accelerate inflation. That reduces the spending power of the American consumer and in the process, the US economic growth declines in real terms and with it, the rest of the world plunges into recession.
While Macron has figured it out that the Neocons are in charge of US foreign policy and he is telling Europe to stop being the puppet of the USA, that all sounds nice but Europe is marching into war with Russia. NATO is firmly in control of the American Neocons and they need war or face losing power. With Trump in the lead, they must stop him at all costs for he is anti-war, would haul the Neocons out by the necks, and defund NATO, as well as stop the climate change agenda.
The US dollar in the global economy has been supported by the size and strength of the US consumer-based economy. Its stability and openness to trade and capital flows without restrictions and it has never been canceled, are the major foundation of the dollar in addition to strong property rights and the rule of law. That is why Russians and Chinese buy US property for they are secure in their ownership of US property which cannot always be guaranteed outside the US.
Consequently, the depth and liquidity of US financial markets remain unmatched. For institutions parking billions, the United States represents a large supply of extremely safe dollar-denominated assets. Are they really going to switch to China or buy debt from Brazil? Not a single institutional client will take that bait.
China has been divesting of dollar reserves because it KNOWS that the American Neocons want war. You do not fund your adversary who intends to wage war against you. China cannot shift reserve assets to Europe or Japan. They have been buying gold because it is geopolitically neutral territory. They are NOT buying gold as an investor thinking it will rally. That is irrelevant. If gold drops 25%, that does not translate into them becoming a seller.
The dollar in international reserves stood at 60+% at the start of 2022 against the US share of GDP at 24.25%. This comparison belittles the argument that the dollar is finished. Eventually, the US will lose the wars it is starting and the dollar will be replaced perhaps as soon as 2028. The IMF is already licking its lips and rubbing its hands together eager to get control of the reserve currency. But they too will collapse. We have a Directional Change next year and a Panic Cycle in 2025. So buckle up.!
Remember one thing, even with the debasement and collapse of the Roman Denarius between 260AD and 268AD, it still took 224 years for Rome to completely collapse. When war breaks out, capital flight will still be to the dollar. It will not be to public assets, but private. The United States is still supporting the entire world economy. The BRICS need the US consumer to keep their economies functioning. All this talk of the dollar being finished is really nonsense. That day will come, but when the US consumer no longer buys.
Remember 1997? The Euro was going to dethrone the dollar. They claimed the new EU will be a bigger economy than the US. The problem was, they lacked a consumer economy, and low taxes, and they routinely canceled their currency to force people to pay taxes. It is always the same story over and over again.
QUESTION: You have suggested that we will end up at war with China, Russia, North Korea, and even Iran simultaneously. How does Socrates conclude such an event that perhaps never happened in the past?
ER
ANSWER: Your assumption that such a thing has never happened is not correct. Periods of war of this nature unfold like a contagion of the flu. The English Civil War (1642-1652) which ended with the beheading of the King in 1649 was instigated using religion as the rallying cry.
In France, there was also an uprising that dramatically interrupted monarchy in 1648 by the uprising of a series of challenges to the absolutism of the King that came to be known collectively as the Fronde. The Fronde (1648-1653) plunged France into civil disorder. The king was even driven from his capital as several provinces revolted. This was a revolution demanding a right to participate in government. When the Fronde ended, the king was restored to absolute royal authority.
Of course, the Fronde may not have changed the French system of government, but it set the stage for the final French Revolution. Nevertheless, the American Revolution then spread with that spirit to overthrow monarchy becoming the France Revolution in 1789.
Throughout history, if we correlate the civil uprisings and forget about the claimed cause, we will see an amazing correlation. Throughout Europe, there was the communist revolution that spread to all the countries in 1848. When you allow the computer to correlate the world, what pops up is that the same Communist Revolution spread to Spanish Latin America, with Revolutions that appeared in New Granada that led to the fall of the government there.
Looking closer, you will see in Brazil there was the Praieira Revolt between 1848-1852. You also see the Mexican-American War, which was also in part inspired by the Battle of the Alamo (February 23 – March 6, 1836).
If we look closely, we will see that 1848 was a”world revolution” for revolutions broke out almost simultaneously in fifty countries from Europe down to Brazil. This era created resentments that lingered beyond domestic revolution and international war just as the reparation payments demanded by the French following WWI led to the rise of Hitler and WWII. The Revolutions of 1848 set the stage for the period that continued into 1880, marking a bloody century with 177 different conflicts.
Even the American Civil War ended slavery and became a contagion that spread to Russia and inspired the 1861 termination of serfdom in Russia.
Socrates has correlated everything. I am sad to report that we are looking at a global uprising. This time, it will be our pretend democracies that are no different than authoritarian monarchies that meet their demise post-2032.
Posted originally on the CTH on April 19, 2023 | Sundance
Some insider threats are more equal than others; so goes the position of the nation’s biggest leaker of classified documents in modern history, and it’s not Jack Teixeira.
This story shows the importance of what was hidden by the combined efforts of the national security apparatus in 2018.
Readers here are familiar, but most Americans are not, with how Senate Intelligence Committee Chairman Mark Warner leaked a top-secret classified Title-1 FISA application in March of 2017.
Then the Vice-Chair of the SSCI, Senator Warner instructed Senate Security Director James Wolfe to leak the 82-page FISA application assembled against Carter Page. On the afternoon of March 17, 2017, Wolfe took 82 pictures of the “Read and Return” document that was delivered to the SSCI basement SCIF by FBI Supervisory Special Agent Brian Dugan from the Washington Field Office.
Later that evening, Wolfe sent the images to journalist Ali Watkins using an encrypted messaging app. Ms. Watkins then shared the FISA content with her peers and used the information to leverage a top-tier job at the New York Times. The media were off to the races talking about FBI surveillance of the Trump campaign and using the leaked FISA as evidence of the ongoing investigation, later known as Crossfire Hurricane. Three days later, March 20, 2017, after coordinating the intent of the narrative creation with Mark Warner, FBI Director James Comey publicly admitted the Trump-Russia investigation for the first time.
After James Wolfe was arrested for the FISA application leak, his defense lawyers threatened to expose the role of the Senate Intelligence Committee in the leak and subpoena the members as witnesses. The Mueller/Weissmann team, then in charge of all DOJ operations that touched on Trump-Russia, took apart the evidence of Wolfe’s conduct, and DC Attorney Jessie Liu dropped most of the charges against Wolfe. Mueller then ran cover for Mark Warner, and eventually – out of an abundance of caution to maintain the need for the coverup operation – the Mueller/Weissmann team then made the FISA application public. The rest is history.
Keep in mind, I could be civilly sued if anything written above as an asserted truth was false. I’m not, because the truth is the defense. All of this happened.
At the time of the Mark Warner TSCI leak, no one outside the DOJ-FBI and Foreign Intelligence Surveillance Court (FISC) had ever seen a FISA application. Heck, in 2017 through early 2018, it was considered a classified intelligence breech to even discuss the FISA process, the procedures or the court itself. People forget that.
The 2017 leaking of the FISA application was the biggest national security breach in years, perhaps seconded only to the 2017 leaking of the TSCI transcript from National Security Advisor Michael Flynn’s call with Russian ambassador Sergey Kislyak, given to the Washington Post by the FBI a month earlier.
So, it’s somewhat hypocritical and ironic to see SSCI Chairman Mark Warner now railing against the Pentagon and Director of National Intelligence over not being provided the details of documents leaked by a low-level military servicemember in the Massachusetts Air National Guard.
WASHINGTON DC – The Senate Intelligence Committee is demanding the Pentagon hand over copies of all the classified documents leaked by Massachusetts Air National Guardsman Jack Teixeira.
The 21-year-old serviceman was accused by the Department of Defense of leaking “sensitive and highly-classified material” into a chat on the encrypted communications platform Discord. It then made its way onto other social media platforms. He was charged on Friday.
In a letter addressed to Defense Secretary Lloyd Austin and Director of National Intelligence Avril Haines, Senate Intelligence Committee Chairman Mark Warner, D-Va., and ranking member Sen. Marco Rubio, R-Fla., said the leak prompted concerns about “serious deficiencies” in the government’s security protocols.
“According to public reporting, A1C Teixeira began sharing classified information and classified documents within a social media platform as early as December 2022—nearly four months before the government’s discovery,” the letter, obtained by Fox News Digital, read. “These disclosures indicate serious deficiencies in the government’s insider threat and security vetting protocols.” (read more)
It’s official – the US is at war with Russia. This is no longer a proxy war regardless of whether an official declaration has been made. Washington confirmed that there is “a small U.S. military presence,” but only made the admission after the Pentagon data leak. National Security Council spokesperson John Kirby insists American soldiers are not fighting on the battlefield.
“I won’t talk to the specifics of numbers and that kind of thing. But to get to your exact question, there is a small U.S. military presence at the embassy in conjunction with the Defense Attachés office to help us work on accountability of the material that is going in and out of Ukraine,” Kirby said, claiming the troops are connecting to a specific embassy. The initial data leak showed that there are also at least 50 troops from the UK on the ground in Ukraine, along with military personnel from 33 NATO nations.
The New York Times reported on Monday morning that NATO members are amassing their troops along the border. “NATO is rapidly moving from what the military calls deterrence by retaliation to deterrence by denial. In the past, the theory was that if the Russians invaded, member states would try to hold on until allied forces, mainly American and based at home, could come to their aid and retaliate against the Russians to try to push them back,” Steven Erlanger wrote. But NATO is going on the offensive rather than the defensive this time around. “To prevent that, to deter by denial, means a revolution in practical terms: more troops based permanently along the Russian border, more integration of American and allied war plans, more military spending and more detailed requirements for allies to have specific kinds of forces and equipment to fight, if necessary, in pre-assigned places,” the journalist wrote.
The war in Ukraine has already cost more than any war since World War II. Ukraine is not a NATO member, and there has never been a situation where NATO prepared its troops to battle a country unaffiliated with its alliance. Russia is completely backed into a corner now and the war must escalate. Putin will not retreat or surrender. Russia does not have the option to surrender as the world powers would swoop in and take over the nation, including its very valuable resources, which they’ve wanted all along. Zelensky is no longer running the show, and the global elites will decide how quickly to escalate this battle. Countless men, women, and children will die, all for the pride of a few who want to destroy the world to Build Back Better.
Chinese President Xi Jinping announced that he is preparing for war. The military budget will grow by about 7.2% this year after it has already doubled over the past decade. This is not a sudden decision. China has been quietly positioning itself for quite some time and has taken notes over Russia’s missteps with Ukraine. The People’s Liberation Army (PLA) is now drafting soldiers, and veterans and college-educated students will be at the top of the list.
Wars are now fought through intelligence and strategies rather than pure brute strength. The PLA is seeking out both women and men and is particularly interested in those with a STEM background. China’s announcement comes after Texas Republican Rep. Michael McCaul visited Taiwan to “provide deterrence to China.” Worse, McCaul told the international press that America would fight alongside Taiwan if Congress approved.
In typical political fashion, McCaul proposed a world war! “Taiwan is in a very different position from Ukraine,” McCaul said. “Number one, they’re not battle tested or ready. They are not prepared for war.” His solution? “When you look at Ukraine, they had NATO supporting them. You don’t have NATO in the Pacific,” he continued. “That’s why when looking at Japan, South Korea, Philippines, Australia, we need to start having these discussions as a deterrent for peace.”
Peace was never an option with Ukraine, and Zelensky made it known that he would not meet Moscow on any agreement. In fact, NATO and others directly helped Kiev break its promises to Moscow, such as France and Germany helping to broker the Minsk Agreement hoax to buy time for Ukraine to build up its military. China has a strategy and a mission.
Losing Taiwan would be seen as an unfathomable loss, and they are prepared to go to war against any nation that intervenes. The West has already stretched itself thin by hyper-fixating on Ukraine as their own economies crumble. Interestingly, US intelligence services believe China will invade Taiwan in 2027. The computer also indicates that a world war could peak as early as 2027, with 2024-2027 being a period of concern.
Posted originally on the CTH on April 17, 2023 | Sundance
This is one of those reality moments when a few more people might scratch their puzzlers and, if we are lucky, possibly awaken themselves to the reality of World War Reddit.
It was not long ago when MSM headlines were all about how Russia was to blame for starving people around the world as a result of Ukraine farming shortages caused by war. As the narrative was told, specifically as it reflected in massive food inflation, the EU and corporate media said the global grain market was missing the farm output from Ukraine, ergo grain prices skyrocketed; ie. Russia bad.
Well, how does this story reconcile with that narrative? According to Reuters reporting, the EU is telling all member states they must take massive shipments of grain and excessive grain commodities into their country even if it collapses the market price. Poland and Hungary said they don’t want the excessive harvest outputs; the EU is telling them they must take them.
Funny how that global famine narrative now disappears under the weight of excessive commodity outputs from Ukraine. Farming output going well in Ukraine. Weirdest war outcome ever. lolol
WARSAW, April 16 (Reuters) – Unilateral action on trade by European Union member states is unacceptable, the bloc’s executive said on Sunday, after Poland and Hungary announced bans on grain and other food imports from Ukraine to protect their local agricultural sectors.
After Russia’s invasion blocked some Black Sea ports, large quantities of Ukrainian grain, which is cheaper than that produced in the European Union, ended up staying in Central European states due to logistical bottlenecks, hitting prices and sales for local farmers.
[…] “We are aware of Poland and Hungary’s announcements regarding the ban on imports of grain and other agricultural products from Ukraine,” a spokesperson for the European Commission said in an emailed statement.
“In this context, it is important to underline that trade policy is of EU exclusive competence and, therefore, unilateral actions are not acceptable.” “In such challenging times, it is crucial to coordinate and align all decisions within the EU,” the statement added.
[…] Solsky said at the weekend that 500,000 to 700,000 tonnes of various [Ukraine] agricultural products cross the Polish border every month, including grain, vegetable oil, sugar, eggs, meat and other products. (read more)
Old narrative “Russia is starving the world”… New narrative “Excessive Ukraine harvests must be accepted”… Any questions?
QUESTION: Mr. Armstrong, The information you provide is so straightforward forward and it is clear you do not sell advertising on your site because you do not want any outside influence. That is really admirable when I realize you do not even require people to register or send them endless emails pitching some investment.
You said the draft will be up to 50 this time and include women. Will they wait until after the 2024 election?
Respectfully;
Jeb
ANSWER: As far as the Draft is concerned, even when we look at when the Vietnam War Draft ended was several months after President Richard M. Nixon had easily won reelection, running against Democratic Sen. George McGovern of South Dakota, an outspoken opponent of the war. That led to the old saying the Democrats always get us into wars, and it takes Republication to end them. I am not sure that will apply this time. Ideally, we are looking at a draft at least being discussed or approved perhaps quietly on September 29th, 2024. This will be 51.6 years from the day Nixon directed the draft to end – January 27th, 1973.
People need to understand that military drafts or “Conscription” dates back to ancient times in Mesopotamia. In more modern times, it resurfaced during the French Revolution in the 1790s. The United States instituted draft or conscription during the Civil War, which led to a series of bloody draft riots. Resistance to the draft, as managed by the Selective Service in the United States, reached a historic peak during the Vietnam War. Here is a draft document from 1863 and you can see they drafted family men.
As the war entered its third season, Congress, in need of more manpower for the Union Army, passed the Civil War Military Draft Act of 1863.
The act called for the registration of all males between the ages of 20 and 45, yet the obligation fell mostly on the poor. Wealthier men could afford to hire a substitute to take their place in the draft or pay $300 for a draft exemption—an enormous sum of money at the time. This controversial provision sparked civil unrest and draft riots.
The most destructive draft riot was the New York Draft Riots that occurred during July 1863. People were not in favor of the war. The New York working class during the Civil War erupted into violence for five days. This was one of the top ten American riots insofar as the death toll was concerned. Hundreds of people were killed and many were far more seriously injured. Many of the rioters were poor Irish immigrants who had fled here due to British oppression. Some of the rioters retaliated against New York’s African American residents who became the scapegoats for long-standing grievances, including wartime inflation, and competition for jobs. The rioters burned down an orphanage for black children—all 223 children narrowly escaped. Men were being taken from their families and were left to fend for themselves, which is understandable as to why it turned to violence.
What they committed from the history books was that when the Civil War broke out in 1861, there was even talk of New York seceding from the Union itself. The business center was deeply involved in business transactions with the Confederate States. The Civil War was a major upheaval. President Lincoln even attacked the New York trading in gold which would rally and decline based on the latest battle news.
The US Congress had passed a conscription act that became the first wartime draft of US citizens in American history and that covered ages of 20 and 45, including aliens with the intention of becoming citizens, by April 1. There have been whispers that they are allowing these illegal aliens to pour into the United States and they will then all be drafted for World War III.
What threw salt into the wound was that the rich could buy their freedom from the draft by paying someone else to take their place. Exemptions from the draft could be bought for $300 or by finding a substitute draftee. This clause was one of the major reasons for the New York City draft riots where protesters were outraged that exemptions were effectively granted only to the wealthiest people. Likewise, the government of the Confederate States also enacted a compulsory military draft. The South, in response to Lincoln’s Emancipation Act, passed their “Twenty Negro Law” whereby a white citizen was exempt if he had 20 or more slaves to take care of.
There were drafts BEFORE the Civil War/ During 1792 an act by Congress required that all able-bodied male citizens purchase a gun and join their local state militia. There was no penalty for noncompliance. Congress also passed a conscription act during the War of 1812. However, that war ended before it was actually enforced. Congress also enacted a military draft during World War I, and in 1940, Congress enacted a military draft under Roosevelt before it entered World War II.
Why these NEOCONS always want war is a question that really needs to be investigated. Not a single war since World War II has ever been to protect the United States. We are fed the story that it is our “national security” but not a single one of these wars has ever threatened an invasion of the United States or threatened to terminate our personal freedoms. War to these people is like playing with toy soldiers. They never think about those who die on the battlefield or the broken families left behind no less all of those who they have killed in opposition who will forever remember Americans as the aggressor who killed their father. Such resentment lasts generations.
The NEOCONS are running scared. they have the perfect president who allows them to control COMPLETE foreign policy and Biden just reads the cue cards. They will rig the next election and the word is that they intend to start a war before the election counting on no president will lose an election in the middle of a war.
Posted originally on the CTH on April 16, 2023 | Sundance
Christine Lagarde, president of the European Central Bank, appears on Face the Nation to describe the current status of EU success in shrinking the economy to achieve parity with the shrinking of energy development. Ms. Lagarde is very happy with their ‘management of the transition’ so far, and sees slow economic growth combined with a citizenry happily accepting the lower standard of living, the new normal.
As Lagarde outlines, the lowered economic activity is helping the central banks support the objectives of the government officials and corporations who are giving the instructions. Overall, she is optimistic the common man and woman will continue accepting less ability to achieve personal economic and financial success, as the bankers and politicians continue managing the western transition. Things are going swimmingly. WATCH:
MARGARET BRENNAN: We’re joined now by Christine Lagarde, former head of the IMF, now the president of the European Central Bank. Good morning.
PRESIDENT OF THE EUROPEAN CENTRAL BANK CHRISTINE LAGARDE: Good morning, Margaret. Lovely to be back.
MARGARET BRENNAN: Good to have you here, and your recovery is going all right?
MADAME LAGARDE: Yes, in a couple of days, I think I’ll be fine.
MARGARET BRENNAN: I’m glad to hear that. You have a long list of things ahead of you. And I want to ask you about the global recovery. You were speaking a few days ago and you said the recovery for the economy is fragile and uncertain in this country. The Fed thinks we’ll see a mild recession later this year. What is it that you predict?
MADAME LAGARDE: First of all, there is recovery. That’s, I think, a point that was not really firm only six months ago where we all assumed that there would be a recession, if only a technical one. If you look at all the forecasts at the moment, it’s all positive. It’s been slightly downgraded. But overall, we have a recovery and we are faced with high uncertainty because of multiple factors, you know, from all corners of the world. It’s the war in Ukraine. It’s the financial stability that clearly has been shaken up a bit by the US and Switzerland development. It’s inflation that we are fighting. It’s all that which really create a hollow of uncertainty around a recovery that we want to embed. That’s pretty much where we are.
MARGARET BRENNAN: So there were those recent bank failures here in the United States, also one in Switzerland. Given that, it sounds like you’re saying you don’t see a hard landing, you’re seeing a positive trajectory for the global economy?
MADAME LAGARDE: I think we have a narrow path to navigate, which requires that both the governments and the central banks around the world adopt the right policies.
MARGARET BRENNAN: OPEC just cut output.
MADAME LAGARDE: Hm?
MARGARET BRENNAN: OPEC just cut output, but you don’t see that as a disruption?
MADAME LAGARDE: I know. And- and we have to be very attentive. But in the meantime, if you look at- I’ll have to look at Europe at the moment. We have reduced our overall consumption of gas energy, for instance, by more than 15 percent. So it’s not as if we negotiated here or there. We just cut down our energy consumption, number one. Number two, we have renegotiated with multiple partners ranging from Norway to the United States of America, which is a big supplier of our energy. And I think that our dependency, which we learned the hard way about, has significantly declined. So I think that we moved from the illusion of plenty of energy, free money, to a time of resilience and building buffers. This is what has happened.
MARGARET BRENNAN: It’s interesting to hear that optimism. I mean, given the bank failures we just saw, you hear from bank CEOs in this country, this idea that they’re getting more cautious about lending money, largely that there’s some contraction in credit there. How concerned are you and how does that complicate your planning?
MADAME LAGARDE: It’s funny you should ask, complication because in a way it facilitates my planning and it complicates the future as far as growth.
MARGARET BRENNAN: Because it slows down business activity so you don’t have to raise rates as much or as frequently.
MADAME LAGARDE: We don’t have to reduce. We’ll see. Because we need to really measure what will come out of this- this financial events that took place recently. What impact will it have? How will banks react? How will they assess risk and how much credit will they lend? But if they don’t lend too much credit and if they manage their risk, it might reduce the work that we have to do to reduce inflation, okay? But if they reduce too much credit, then it will weigh on growth excessively. So it’s a fine balance to have between credit risk, good management on the one hand, and on the other hand, financing the economy as is expected by- by the business community. The business community wants to invest at the moment. Some of them have big buffers and they can use those buffers, others are going to need credit financing from the banking sector and the markets, both of them.
MARGARET BRENNAN: I want to ask you about the U.S.. And it’s not a political question, it’s an economic one. But there are predictions that the U.S. could default in its national debt as soon as June, some say September, and we have a political standoff in this country, virtually no negotiation happening on how to resolve this. Does that undermine your confidence in the United States? And what message does that send to the world?
MADAME LAGARDE: I have huge confidence in the United States. You know, ever since my year in this country, and this city in ’73, ’74, I have had confidence in this country and I just cannot believe that they would let such a major, major disaster happen of the United States defaulting on its debt. This is not possible. I cannot believe that it would happen. But if it did happen, it would have very, very negative impact, not just for this country where confidence would be challenged, but around the world. Let’s face it, this is the largest economy. It’s a major leader in economic growth around the world. It cannot let that happen. I understand the politics, I’ve been in politics myself. But there is a time when the higher interest of a nation has to prevail. I’m sorry.
MARGARET BRENNAN: And you think that will happen?
MADAME LAGARDE: I have huge trust in this country yet again.
MARGARET BRENNAN: You’re bringing a lot of optimism to a show where we don’t have a lot of optimism.
MADAME LAGARDE: Oh. I’m sorry (laughs)
MARGARET BRENNAN: No, I like it. It’s interesting. It’s a change. I want to ask you, though, about what you just said in terms of U.S. leadership. You look to the other side of the globe and Xi Jinping has said he wants China to be the world’s leading power by 2049. And Beijing is very interlinked into so many economies, particularly in Europe. Is the U.S. losing global influence?
MADAME LAGARDE: There is clearly a competition between these- these large economies. The U.S. is the first economy in the world. China is clearly competing, and is putting all forces in that competition. I think competition is healthy. It has to stimulate innovation. It has to stimulate productivity. But it’s inevitable that these two large economies are facing each other. What I hope very much is that they can have a dialogue because, you know, all these relationships, whether it’s trade, whether it’s politics, whether it’s economic development, whether it is financial stability, it’s a two-way street. We cannot ignore each other, and trade should not be confrontational. It has to be careful. It has to identify the areas that are strategic for one country or the other- or all the others. But it shouldn’t be confrontational. I’m on the same page as Henry Kissinger on that, or Kevin Rudd, the new Australian ambassador. Conflict is not unavoidable.
MARGARET BRENNAN: But there is, it seems, increased political pressure to choose between the United States and China in many ways in some of these political capitals. Is that even practical from an economic point of view?
MADAME LAGARDE: It would lead to economic downside, the amount of which is uncertain. Is the global economy going to be affected by one or X percent? There are multiple forecasts, all of them are negative. So the decoupling and the sort of bipolarization of the world would lead to less economic growth, less prosperity in the world, more poverty across the world. So I think that this is something that should be by all means avoided.
MARGARET BRENNAN: Madame Lagarde, it’s always wonderful to have you here. Thank you. We’ll be right back.
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