Government

De-Dollarization

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I read a few Telegram channels, one of which recently posted about the fact that Saudi Arabia has terminated its agreement with the US to accept payment for its oil only in USD. I believe the writer sees this as part of the ongoing unravelling of the old order and ponders its significance. I penned the following, but was unable to post on his channel since he has quite wisely instituted restrictions on the length of replies and also does not allow long replies to be split over multiple posts. This indicates to me that he is actually running the channel on his own and does not have “staff” to manage the spam.

Anyway this is what I wrote :

I get that your commenting on this, is that you see it as part of the entire systemic unravelling that we’re currently witnessing. This system is ending, probably messily, because it is unsustainable and because those “in charge”, who really don’t know what they’re doing, have embraced some horrible ideas. But the attractiveness of USD versus any other currency is actually a pretty complicated subject, and not due solely to Saudi oil being sold solely in USD (or not), or for that matter US interest rates or Bond issuance levels. There are more significant factors at play.

The first is that, however bad things look for US debt levels, the issuance of US debt fulfills a global function. US bonds act as collateral for money creation in the global economy outside the US. As a simple example, Japanese banks issuing USD loans (“creating money out of thin air”) to Chinese companies, accept only US Bonds as collateral. This creates sustained demand for US Treasuries, because their value to the holder is not the payment of the Bond coupon or the return of the principal at redemption, but the value of the project they are used to fund, which, bit of a random guess, may have an ROI of anywhere from 30% to, I don’t know, 200% ?? A big number. The 5% yield on the Bond itself is irrelevant. The US financial markets are the biggest and therefore most liquid. No bank would accept Chinese bonds (no rule of law) or Japanese, (60% of the market is owned by the BoJ), certainly not Eurozone, since the Eurozone must eventually collapse and default (the ECB can’t create currency or borrow). There is no alternative to the US Bond market as collateral.

The second point is, Saudi oil notwithstanding, some huge percentage of international trade is settled in USD, so there is sustained demand for USD through usage. If I’m a Brazilian exporter, selling my product to 20 different countries and settling all in USD is far more efficient than having to settle in 20 individual currencies. Sure, Oil is the most important global commodity, and the Saudi move is ‘interesting’, but it is not clear what effect it will have, if any. KSA is still a ‘US aligned’ country and Oil will still be priced and traded in USD. All this talk of the BRICS creating their own currency is (currently still) laughable. To replace USD, all these currencies would have to agree to create either a new currency and it would have to be somehow collateralised. No one will use a Chinese Communist CBDC. China may be buying all the Gold, but this currency will never be Gold backed i.e. convertible. If any foreign party thinks they will be able to swap pieces of freshly printed paper for Chinese Gold and take it home, they will be very disappointed. Similarly, tokenised “ownership” of Chinese held Gold under a Chinese gold-backed CBDC is also laughable. China does not permit private property. Full Stop. If these countries, who are not really “allies”, try to set up some kind of clearing system they will still have the problem of where Gold is located, how to transport Gold from one location to another and under what conditions can balance transfers take place.

But the main problem of Gold backed currencies is that the supply of “money” is restricted to the amount of Gold available to back it. Since economic activity is fundamentally driven by the amount of currency available to flow within the economy and enable transactions, the restriction of this flow would immediately create deflationary collapse within the these emerging economies and the resulting social disruption would probably be terminal for any number of regimes unwise enough to try it. On the other hand, if these countries decide to replace USD in transactions they would have to print their own currency to act as ‘the means of exchange’. Since this could not be Gold backed, if it were instead unbacked, or backed by some irredeemable ‘notional’ value, then this would have the opposite effect of initiating a Weimar or Zimbabwe style collapse in the value of the currency, leading to hyperinflation.

At the deepest level, the current system is only the way it is because the US is willing to run a huge deficit, otherwise it would not need to borrow, its bonds would not be the backing of the world’s fiat currency banking systems and its currency would not be the global currency of trade and finance. This is the product of the Anglo free market system and its resulting 20th century ascent to global dominance, and has enabled the US to project force throughout the world, debatably to the detriment of any involved, not least the US itself. The flip side of this is that the rest of the world is engaging in mercantilism, trying to run surpluses and accumulate wealth domestically at the expense of their trading partners. Which of these countries would choose, or be able, to reverse roles ? None, of course.

Under these circumstances, the most probable outcome of these initial attempts at “de-dollarization” will be completely perverse. USD will increase in value in the coming years. As these threats of devaluation of non US currencies become clearer, all asset holders outside the US will come to view the US as the only safe haven and start to transfer as much of their wealth there as possible. This is why the US dollar will go much higher against all world currencies and why, having bought those USD, foreigners will buy US assets; the primary beneficiary will be the most liquid US stocks. These inflows will do a lot to sustain US fiscal profligacy for a few more years, so the increase in US interest rates will not be harmful to the US’s ability to service this debt, since they will be able to refinance it for a long time to come with continued foreign buying. The Fed’s ‘ace in the hole’ is that all the gold on its balance sheet is valued at $35 an ounce (or something equally unrealistically low). So for the next few years USD will outperform all other fiat currencies, but in the end, Gold will ultimately outperform USD.

Once digital money is forced on us, then private digital money will take the place of public (government) digital money in private transactions and we will end up with two tier money. Probably not BTC on the main chain, (although Lightning network is very interesting with some great privacy projects like NOSTR), or some other privacy coin like Monero (XMR) or Pirate Chain (ARRR), which will be decided by the market.

But whatever happens, “they” won’t win.

Covid 19

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An anonymous statement from an A&E consultant in Surrey. No comment necessary really.

“Staff only wear face coverings/ masks & social distance when public facing, as soon as they are out of public view, the masks come off and social distancing is not observed. Indeed jokes are made about the measures, and I have heard staff express amazement that despite warnings on packets and at point of sales, telling people masks are totally ineffective and dangerous , the public still buy them, because a politician has told them to.”

Released 08/07/20.
I am a consultant at a major, regional hospital in Surrey. By major you can take that to indicate that we have an A&E department. I had agreed to give an interview to an anti lockdown activist in which I would have revealed my identity. I have since changed my mind and only feel able to give an
anonymous statement. I have changed my mind simply because that all staff , no matter what grade, at all hospitals have been warned that if they give any media interviews at all or make any statements to either the Main Stream Press or smaller, independent press /social media we may, immediately be suspended without pay. I have a family, dependents and I simply cant do it to them. I therefore can not reveal my identity at this time but wish to state as follows:

In my opinion, and that of many of my colleagues, there has been no Covid Pandemic, certainly not in the Surrey region and I have heard from other colleagues this picture is the same throughout the country. Our hospital would normally expect to see around 350,000 out patients a year. Around 95,000 patients are admitted to hospital in a normal year and we would expect to see around a similar figure, perhaps 100,000 patients pass through our A&E department. In the months from March to June (inclusive) we would normally
expect to see 100,000 out patients, around 30,000 patients admitted to hospital and perhaps 30,000 pass through A&E. This year (and these figures are almost impossible to get hold of) we are over 95% down on all those numbers. In effect, the hospital has been pretty much empty for that entire period.

At the start, staff that questioned this were told that we were being used as ‘redundant’ capacity, kept back for the ‘deluge’ we were told would come. It never did come, and when staff began to question this, comments like, ‘for the greater good’ and to ‘protect the NHS’ came down from above. Now its just along the lines of, ‘Shut up or you don’t get paid’. The few

Covid cases that we have had , get repeatedly tested, and every single test counted as a new case. Meaning the figures reported back to ONS / PHE (Office for National Statistics & Public Health England) were almost exponentially inflated. It could be that Covid cases reported by hospitals are between 5 to 10x higher than the real number of cases. There has been no pandemic and this goes a long way to explain why figures for the UK are so much higher than anywhere else in Europe.

The trust has been running empty ambulances during lockdown and is still doing it now. By this I mean ambulances are driving around, with their emergency alert systems active (sirens & / or lights) with no job to go to. This I believe has been to give the impression to the public that there is more demand for ambulances than there actually is. Staff only wear face coverings/ masks & social distance when public facing, as soon as they are out of public view, the masks come off and social distancing is not observed. Indeed jokes are made about the measures, and I have heard staff express amazement that despite warnings on packets and at point of sales, telling people masks are totally ineffective and dangerous , the public still buy them, because a politician has told them too.

We have cancelled the vast majority of operations and of these ALL elective surgery has been cancelled. That’s surgery that has been pre planned / waiting list. Non elective Surgery, this tends to be emergency surgery or that which is deemed urgent has been severely curtailed. The outcome of this is simple. People are at best being denied basic medical care and at worst, being left to die, in some cases, in much distress and pain.

Regarding death certification. All staff that are responsible for this have been encouraged where possible to put Covid-19 complications as reason for death, even though the patient may have been asymptomatic and also not even tested for covid. I feel this simply amounts to fraudulently completed death certificates and has been responsible to grossly inflating the number of Covid deaths. The fact is that regardless of what you actually die of in hospital, it is likely that Covid-19 will feature on your death certificate. I have included with my statement the detailed published guidance from Government on Death Certification which shows how Covid-19, as a factor is encouraged to at least feature on a death certificate. Remember Covid-19 itself can not kill. What kills is complications from the virus, typically pneumonia like symptoms. These complications are in reality incredibly rare but have featured and a large amount of death certificates issued in recent months. As long as Covid-19 appears on a death certificate, that death is counted as Covid-19 in the figures released by the ONS and PHE. I genuinely believe that many death certificates, especially amongst the older 65+ demographic have been fraudulently completed so as to be counted as Covid-19 deaths when in reality Covid-19 complications did not cause the death.

There have been Thursday nights when I stood, alone in my office and cried as I heard people cheering and clapping outside. It sickens me to see all the ‘Thank You NHS’ signs up everywhere and the stolen rainbow that for me now says one word and word only ; Fear.

There are many good people in the NHS and whilst I do not plead forgiveness for myself, I do plead for them. Most are on low pay, they joined for the right reasons and I did and have been bullied and threatened that if they don’t ‘stay on message’ they don’t eat. I know that if a way could be found to assure staff within the NHS of safety against reprisals, there would be a tsunami of whistleblowers which I have no doubt would help end this complete and brutal insanity. I am finding it increasingly hard to live with what I have been involved in and I am sorry this has happened. To end, I would simply say this. Politicians haven’t changed, the country has just made a fatal mistake and started trusting them without question.