The Silent Death Of The U.S. Dollar

To begin, I would like put forth the observation that the U.S. Government has become particularly belligerent militarily toward the rest of the world.  Anyone who thinks the U.S. is not provoking Russia and China all over the globe has their head in the sand or is incapable of looking at the facts outside of the tragically skewed propaganda coming from Washington, DC  that is being funneled through the U.S. media pipeline.

The reason the U.S. is trying to stir up global military chaos is simple, the U.S. dollar is being systematically removed from its reserve status.   The latest evidence of this is the news report yesterday that China and Argentina are going to begin trading in their respective currencies, with trade settlement in yuan – NOT dollars:   News Link.  Please note this news is not being reported by the U.S. mainstream financial media.

“Big deal,” you might think.   But also unreported over the last couple of years is that China has been quietly arranging these bi-lateral trade deals with EVERY major trading partner, including several European countries.  Recently China signed huge deals with Iran and Russia to trade energy in their respective currencies.   This IS a big deal.   China and Russia are systematically extricating their trade activities from the dollar.

Yes, the dollar has bounced considerably higher in the last couple of months.  But this is because the main components of the dollar index – the yen and the euro – have been melting into oblivion.  The yuan and ruble are not included in the standard measurement of the dollar’s value.  Russia and China don’t care about that value of their currencies in relation to the dollar,  other than the effect it has on their Treasury holdings.  But Russia and China are slowly unloading their Treasuries.   They are both accumulating physical gold hand over fist.

At the end of March the GLD trust had 820 tonnes of gold in it.  It’s down to 785 tonnes.  I bring this up because the market falsely assumes that a decline in the amount of gold held in GLD is a sign investors are selling gold.  This is not true.   Selling GLD shares is not a trigger for the removal of gold from the GLD trust.  The ONLY way gold is removed is if one of the Approved Participant banks puts together 100,000 share baskets and exchanges them for gold bars.  Note: the banks can create shares by borrowing them.  The short interest in GLD is quite high.   Gold is being removed from GLD because the western bullion banks (JP Morgan, HSBC, Scotia, etc) are on the hook for paper claims they have printed up and dumped into the market.  Some of those claims (LMBA forwards, especially) end up in Chinese hands.   The U.S. can not default on those.

I bring this up because if you’re wondering where that gold from GLD has gone, look east to China. That gold is sitting in vaults in China, owned by the Peoples Bank of China and private investors.   China is systematically extracting as much gold as it can from the west.  China, and Russia,  is methodically killing the dollar.   The sign posts are there to see for anyone who wants to look for them.

10 thoughts on “The Silent Death Of The U.S. Dollar

  1. SIPC Insurance Scam from Fraud Street-Professor Laurence Kotlikoff

    Dr. Kotlikoff goes on to warn of massive and ongoing Wall Street fraud. Dr. Kotlikoff says, “Every day we are reading about a big bank being fined billions of dollars. Recently, Bank of America had a $16 billion fine the bank had to pay for selling fraudulent securities. They know they are selling you snake oil, and they are getting away with it, and nobody is going to jail. I call Wall Street, at this point, Fraud Street, and one of the biggest rackets is the SIPC brokerage account insurance–it’s not really insurance. A fraud occurs and Wall Street, through SIPC, says we owe you nothing, and they sue you to get paid back. That’s what we call an insurance scam. Wall Street, through SIPC, has been running a massive insurance scam. . . . In many ways, you could say SIPC is running its own Ponzi scheme.”

    http://usawatchdog.com/sipc-insurance-scam-from-fraud-street-professor-laurence-kotlikoff/

    SEC Won’t Appeal Adverse Stanford Ruling

    The Securities and Exchange Commission is abandoning its legal battle to win compensation for nearly 8,000 victims of R. Allen Stanford’s Ponzi scheme.

    A federal appeals court in July threw out the SEC’s lawsuit against the Securities Investor Protection Corp., which found that about 7,800 former clients of Stanford’s bank were not eligible for payments because Stanford International Bank was based in Antigua and was not a member of the SIPC, unlike Stanford’s Texas-based Stanford Group. The court sided with the SIPC, upholding a 2012 district-court ruling.

    The victims were sold fraudulent certificates of deposit by the Stanford bank.

    SIPC President Stephen Harbeck said his organization “has always had great sympathy for the people who purchased the certificates of deposit issued by the Stanford International Bank, but the statute that SIPC administers does not address the losses of these victims.”

    The SEC said it had given up on an appeal “after very careful deliberation,” earning the ire of the Stanford Victims Coalition.

    “Unfortunately, Stanford victims have no private right of action against the SIPC,” founder Angela Shaw Kogutt told Reuters. “The Commission has caved to an organization it is supposed to oversee.”

    http://www.finalternatives.com/node/28223

  2. “I bring this up because if you’re wondering where that gold from GLD has gone, look east to China. That gold is sitting in vaults in China, owned by the Peoples Bank of China and private investors. China is systematically extracting as much gold as it can from the west. China, and Russia, is methodically killing the dollar. The sign posts are there to see for anyone who wants to look for them.”

    I don’t disagree in the least Dave, but I must say I’m having an increasingly hard time believing the Chinese are doing this on their own. This line of thinking says the PTB in the West is letting the gold be drained and bought by the Chinese because that’s where “they” plan to move their power hub in the near future.

    Do we really think the West’s most powerful families and entities would continue let this drain occur if they weren’t in on it or behind it? In other words in their interest?

    Highly dubious.

    1. I know that the theory is out “there” that the wealthy elite in the west are conspiring with the Chinese elite to loot the west of gold. I just don’t have enough “dotted line” evidence to buy into this myself, but anything could be true. I’m sure the Rothschilds et al are pilfering their “fair” share of the physical gold being confiscated and hidden away. I have a hard time believing the big banks in the U.S./EU are part of this, because these banks are going to blow up on derivatives and will not exist some day. HSBC is a different beast, and it may have already set up entities in China that are “bankruptcy remote” from the operations in the rest of the world.

      There’s just no way to know because true disclosures rules are almost non-existent anymore.

  3. Dave: What are your thoughts on the price of silver in the future with regards to it all being used up? I read somewhere that by 2035 (or thereabouts) that all the silver would be used up.

    This must be bullish?

    1. 2035? I think the world will be mired in WW3 sometime in the next 2-3 years. 2035 might not be issue for anyone living above ground today…

  4. The low price of gold could be the result of a negotiation between major holders of US Treasury debt (foreign creditors) and the US government. We will make sure you can buy gold at stable prices if you promise to hold on to our debt. In an environment of extremely low interest rates, the reserve status of the US Dollar can be maintained only if gold can be bought and paid for in Dollars. To lower the appetite of foreign creditors for gold, the gold price must be prevented from rising.

    1. That theory has been floated for awhile. I think we are seeing a massive all-encompassing currency war going on beneath the surface. The U.S./Euro manipulators/Ponzi Schemers have dug a hole so deep with paper gold that they have no hope of digging out. The U.S. Govt doesn’t give a shit if it defaults on Treasuries. But if it defaults on gold, the dollar will go to zero. That would wipe out the wealth entirely of most of the perpetrators. They have no choice but keep printing paper gold and dumping it on the market to keep the price down. As long as they can source physical to deliver, they’re fine.

      The U.S. collapsed in 2008. It took trillions in QE and Govt stimulus to keep the system going. Right now EVERY SINGLE person who is in a position to steal wealth from everyone NOT in a position to do that is working overtime to take what they can.

      We will be in WW3 before the truth is out.

      1. “The U.S. collapsed in 2008. It took trillions in QE and Govt stimulus to keep the system going. Right now EVERY SINGLE person who is in a position to steal wealth from everyone NOT in a position to do that is working overtime to take what they can.”

        DAMN! sometimes, Dave, I wish you weren’t so right. If it took so much to keep the system going after 2008, there’s no way to keep it afloat at the next “break”. They say all financial crashes in the US happens in the fall. We will see…..

        http://www.pbs.org/wgbh/pages/frontline/shows/crash/etc/again.html

        intersting article – especially when George Soros (sic) is worried.

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