{"id":79291,"date":"2015-10-07T13:50:44","date_gmt":"2015-10-07T17:50:44","guid":{"rendered":"http:\/\/countingpips.com\/?p=79291"},"modified":"2015-10-07T13:50:44","modified_gmt":"2015-10-07T17:50:44","slug":"how-the-chinese-will-establish-a-new-financial-order","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2015\/10\/how-the-chinese-will-establish-a-new-financial-order\/","title":{"rendered":"How the Chinese Will Establish a New Financial Order"},"content":{"rendered":"<div id=\"inves-1042372312\" class=\"inves-below-title-posts inves-entity-placement\"><div id =\"posts_date_custom\"><div align=\"left\">October 7, 2015<\/div><hr style=\"border: none; border-bottom: 3px solid black;\">\r\n<\/div><\/div><h4><span style=\"font-size: small;\">By Porter Stansberry<\/span><\/h4>\n<div id=\"article-body\" class=\"margin_top_25\">\n<p>For many years now, it\u2019s been clear that China would soon be pull\u00ading the strings in the U.S. financial system.<iframe loading=\"lazy\" src=\"http:\/\/trk.caseyresearch.com\/f\/?content_id=1298&amp;code=PIP&amp;editorial=how-the-chinese-will-establish-a-new-financial-order-1\" width=\"1\" height=\"1\" frameborder=\"0\"><\/iframe><\/p>\n<p>In 2015, the American people owe the Chinese government nearly $1.5 trillion.<\/p>\n<p>I know big numbers don\u2019t mean much to most people, but keep in mind\u2026 this tab is now hundreds of billions of dollars more than what the U.S. government collects in ALL income taxes (both cor\u00adporate and individual) each year. It\u2019s basically a sum we can never, ever hope to repay \u2013 at least, not by normal means.<\/p>\n<p>Of course, the Chinese aren\u2019t stupid. They realize we are both trapped.<\/p>\n<p>We are stuck with an enormous debt we can never realistically repay\u2026 And the Chinese are trapped with an outstanding loan they can neither get rid of, nor hope to collect. So the Chinese govern\u00adment is now taking a secret and somewhat radical approach.<\/p>\n<p>China has recently put into place a covert plan to get back as much of its money as possible \u2013\u00a0<strong>by extracting colossal sums from both the United States government and ordinary citizens, like you and me<\/strong>.<\/p><div id=\"inves-3233287529\" class=\"inves-in-content inves-entity-placement\"><hr style=\"border: 1px solid #ddd;\">\r\n<div id=\"inpost_ads_header\">\r\n<p style=\"font-size:10px; float:left; color:#666;\">Free Reports:<\/p><\/div>\r\n<div id=\"inpost_ads\"> \r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/1ApBOV\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2018\/06\/graph_techs_PD.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t     <a href=\"https:\/\/goo.gl\/1ApBOV\"><b><u>Get Our Free Metatrader 4 Indicators<\/u><\/b><\/a> - Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter<\/p><br><br>\r\n<br>\r\n<br>\r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/f3RrHX\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2019\/01\/cot_pie_80.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t    <a href=\"https:\/\/goo.gl\/f3RrHX\"><b><u>Get our Weekly Commitment of Traders Reports<\/u><\/b><\/a> - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.<\/p><br><br>\r\n<\/div>\r\n<hr style=\"border: 1px solid #ddd;\">\r\n<br><\/div>\n<p>The Chinese \u201cState Administration of Foreign Exchange\u201d (SAFE) is now engaged in a full-fledged currency war with the United States. The ultimate goal \u2013 as the Chinese have publicly stated \u2013 is to cre\u00adate a new dominant world currency, dislodge the U.S. dollar from its current reserve role, and recover as much of the $1.5 trillion the U.S. government has borrowed as possible.<\/p>\n<p>Lucky for us, we know what\u2019s going to happen. And we even have a pretty good idea of how it will all unfold. How do we know so much? Well, this isn\u2019t the first time the U.S. has tried to stiff its foreign creditors.<\/p>\n<p>Most Americans probably don\u2019t remember this, but our last big currency war took place in the 1960s. Back then, French President Charles de Gaulle denounced the U.S. government\u2019s policy of print\u00ading overvalued U.S. dollars to pay for its trade deficits\u2026 which allowed U.S. companies to buy European assets with dollars that were artificially held up in value by a gold peg that was nothing more than an accounting fiction. So de Gaulle took action\u2026<\/p>\n<p>In 1965, he took $150 million of his country\u2019s dollar reserves and redeemed the paper currency for U.S. gold from Ft. Knox. De Gaulle even offered to send the French Navy to escort the gold back to France. Today, this gold is worth about $12 billion.<\/p>\n<p>Keep in mind\u2026 this occurred during a time when foreign govern\u00adments could legally redeem their paper dollars for gold, but U.S. citizens could not.<\/p>\n<p>And France was not the only nation to do this\u2026 Spain soon re\u00addeemed $60 million of U.S. dollar reserves for gold, and many other nations followed suit. By March 1968, gold was flowing out of the United States at an alarming rate.<\/p>\n<p>By 1950, U.S. depositories held more gold than had ever been assembled in one place in world history (roughly 702 million ounces). But to manipulate our currency, the U.S. government was willing to give away more than half of the country\u2019s gold.<\/p>\n<p>It\u2019s estimated that during the 1950s and early 1970s, we essentially gave away about two-thirds of our nation\u2019s gold reserves\u2026 around 400 million ounces\u2026 all because the U.S. government was trying to defend the U.S. dollar at a fixed rate of $35 per ounce of gold.<\/p>\n<p>In short, we gave away 400 million ounces of gold and got $14 billion in exchange. Today, that same gold would be worth $620 billion\u2026 a 4,330% difference.<\/p>\n<p>Incredibly stupid, wouldn\u2019t you agree? This blunder cost the U.S. much of its gold hoard.<\/p>\n<p>When the history books are finally written, this chapter will go down as one of our nation\u2019s most incompetent political blunders. Of course, as is typical with politicians, they managed to make a bad situation even worse\u2026<\/p>\n<p>The root cause of the weakness in the U.S. dollar was easy to understand. Americans were consuming far more than they were producing. You could see this by looking at our government\u2019s annual deficits, which were larger than ever and growing\u2026 thanks to the gigantic new welfare programs and the Vietnam \u201cpolice ac\u00adtion.\u201d You could also see this by looking at our trade deficit, which continued to get bigger and bigger, forecasting a dramatic drop (eventually) in the value of the U.S. dollar.<\/p>\n<p>Of course, economic realities are never foremost on the minds of politicians \u2013 especially not Richard Nixon\u2019s. On August 15, 1971, he went on live television before the most popular show in Ameri\u00adca (<em>Bonanza<\/em>) and announced a new plan\u2026<\/p>\n<p>The U.S. gold window would close effective immediately \u2013 and no nation or individual anywhere in the world would be allowed to exchange U.S. dollars for gold. The president announced a 10% surtax on ALL imports!<\/p>\n<p>Such tariffs never accomplish much in terms of actually altering the balance of trade, as our trading partners simply put matching charges on our exports. So what actually happens is just less trade overall, which slows the whole global economy, making the impact of inflation worse.<\/p>\n<p>Of course, Nixon pitched these moves as patriotic, saying: \u201cI am determined that the American dollar must never again be a hos\u00adtage in the hands of international speculators.\u201d<\/p>\n<p>The \u201csheeple\u201d cheered, as they always do whenever something is done to \u201cstop the speculators.\u201d But the joke was on them. Within two years, America was in its worst recession since WWII\u2026 with an oil crisis, skyrocketing unemployment, a 30% drop in the stock market, and soaring inflation. Instead of becoming richer, millions of Americans got a lot poorer, practically overnight.<\/p>\n<p>And that brings us to today\u2026<\/p>\n<p>Roughly 40 years later, the United States is in the middle of anoth\u00ader currency war. But this time, our main adversary is not Europe. It\u2019s China. And this time, the situation is far more serious. Our nation and our economy are already in an extremely fragile state. In the 1960s, the American economy was growing rapidly, with decades of expansion still to come. That\u2019s not the case today.<\/p>\n<p>This new currency war with China will wreak absolute havoc on the lives of millions of ordinary Americans, much sooner than most people think. It\u2019s critical over the next few years for you to understand exactly what the Chinese are doing, why they are doing it, and the near-certain outcome.<\/p>\n<p>Regards,<\/p>\n<p>Porter Stansberry<\/p>\n<p>(This is an adaptation of an article that was originally published in Porter&#8217;s <em>Investment Advisory.)<\/em><\/p>\n<p><strong>Editor\u2019s Note<\/strong>: Because this risk and others have made our financial system a house of cards, we\u2019ve published a groundbreaking step-by-step manual on how to survive, and even prosper, during the next financial crisis. In this book,\u00a0<em>New York Times <\/em>best-selling author Doug Casey and his team describe the three ESSENTIAL steps every American should take right now to protect themselves and their family.<\/p>\n<p>These steps are easy and straightforward to implement. You can do all of these from home, with very little effort. Normally, this book retails for $99. But I believe this book is so important, especially right now, that I\u2019ve arranged a way for US residents to get a free copy.\u00a0<a href=\"http:\/\/www.internationalman.com\/go\/upsgh-2\/PIP\" target=\"_blank\">Click here to secure your copy.<\/a><\/p>\n<div class=\"clear-me\"><\/div>\n<\/div>\n<div id=\"xvMdV95u77zU\" style=\"clear: both;\">The article was originally published at <a href=\"http:\/\/www.internationalman.com\/go\/ups3i-2\/PIP\">internationalman.com<\/a>.<\/div>\n","protected":false},"excerpt":{"rendered":"<p>By Porter Stansberry For many years now, it\u2019s been clear that China would soon be pull\u00ading the strings in the U.S. financial system. In 2015, the American people owe the Chinese government nearly $1.5 trillion. I know big numbers don\u2019t mean much to most people, but keep in mind\u2026 this tab is now hundreds of [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-79291","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/79291","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=79291"}],"version-history":[{"count":1,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/79291\/revisions"}],"predecessor-version":[{"id":79292,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/79291\/revisions\/79292"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=79291"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=79291"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=79291"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}