Vladimir Doesn't Waste Any Time

Mr. Putin appears to be on a roll.  Parasite? Ouch.
"Russia and China have vowed to make progress on a long-delayed deal on gas sales, as Russian Prime Minister Vladimir Putin sought to boost ties with Beijing while likening the U.S. to a parasite."
Source: Time.com

Nukes Under Construction

"The Daily Reckoning" reports that of the nuclear power plants that are currently under construction around the world, of these, 42% reside in China; 16% in Russia and 11% in India. The G-7 countries, combined, account for only 3% of all nuclear plants currently under construction.

With the recent events in Japan, the U.S. is unlikely to shift strategies anytime soon. Now the Chinese, well that's another story. I'm sure that they'll "stay the course" on their energy plan. How nice it must be to have one!

China's Approach

I've made a few posts lately regarding the use of technology for the purposes of organizing protests across the Northern African countries.  Facebook, Twitter, and Blogging appears to be the method for communicating and organizing amongst these angry youth.  I thought this was interesting to see how the Chinese are proactively preparing for potential uprising.

"Even China, worried about its citizens being inspired by the uprisings, disabled searches for the word "Egypt" on some internet services, underscoring Beijing's continued concern over the Internet and its potential to access anti-government information and organize opposition to China's ruling Communist Party."
Source: LA Times

The Power of The Sheeple

My bubby, J, shared this one with me. Note the trucks moving in reverse. The power of the people.



This scene brings back memories.

Handcuffing The Kids

"Currently, your child's share of the national debt is around $45,000. Come 2015, provided current trends continue, it'll be bumping up against $70,000. China will own an unnervingly large portion of that debt. If policy makers in the US are so concerned about China's human rights record and its monetary meddling, how can they possibly justify shackling their children with debt handcuffs that are, so to speak, 'Made in China'?"
Source: Joel Bowma, The Daily Reckoning

P.S. See "Passing Along The Cancer"

Rekindling The Flames

Keep an eye on these old foes.
"Executives and traders in both countries have said that Chinese customs agents have blocked rare-earth exports since early last week, after a diplomatic dispute over Japan’s detention of a captain of a Chinese fishing trawler in waters claimed by both countries. Japan released the captain Friday."
Source: New York Times


"Rekindle, reignite...it's all the same thing. My prediction on this one was that when the tide lowers, it's easy to pick a fight with an old foe. It usually takes a small spark."
Random Roving, March 8, 2009

China's On The Move

China's on the move:

• China overtakes Germany to become third-largest economy in the world
• China out-muscles the U.S. to become the largest market for passenger vehicles in the world
• China passes Germany to become the world’s largest exporter
• China powers past the U.S. to become the world’s largest energy user
• China blows by Japan to become the second-largest economy in the world

Source: Casey's Research

Tech vs Big Bad Governments

I find these two "tech battles" interesting in the context of "mass social mood".

"The makers of the BlackBerry were looking into the possibility of using servers in Saudi Arabia on Friday to avert a threatened ban on its Messenger services by Saudi government, which wants access to its encrypted network, a source said on Friday."
Source: Reuters

"Google Inc. reported Thursday that its Web search, mobile and advertising services in China had been blocked.  It was unclear if the services had been temporarily disrupted or if they were being blocked by the Chinese government."
Source: LA Times

China's Oil Plan

While we continue to squabble in our country, China is on a "full court press" with their energy strategic plan.

"It’s a pretty safe bet that, as one of the world’s fastest growing economies, China needs a lot of energy. And with an oil appetite that grows by 7.5% each year, seven times faster than the U.S., the country’s reserves don’t even begin to compare to the consumption.  But fuelling the blistering pace of its economy is China’s number one priority, and it is on a mission to lock down its energy interests all around the world. The emerging powerhouse has often felt that it was the last one onto the energy playing field with a lot of catching up to do.  Today, Chinese national oil companies (NOCs) are setting up shop everywhere from the Middle East all the way to the oil sands of Canada, and they’re open for business. The three NOCs – CNPC/PetroChina, Sinopec and CNOOC Ltd – are slated to produce a record breaking one million barrels daily. That’s Australia’s daily fuel consumption!  It isn’t just their oil production that’s going through the roof. Since 2009, China has committed nearly US$25 billion into corporate and asset acquisitions. China isn’t going it alone either, and fully realizes the importance of forging partnerships with other international oil companies to develop oil fields.  And with Beijing firmly behind them, they’re only doubling their efforts this year. Chinese NOCs accounted for nearly 20% of all global deal values in the first quarter of 2010. This share will only get bigger as the year carries on and energy security continues to dominate the agenda.  Armed with strong finances, an aggressive approach, and implicit government backing, Chinese companies are well placed to spearhead the nation’s mission of diversifying its international energy portfolio. The latest thing to catch their attention: the mysterious oil elephants of East Africa."
Marin Katusa

The Triad

“The Americans get the toys, the Chinese get the Treasuries, and we get screwed.”
Unnamed European official

Casey On China

"China is going to blow up. The amount of currency the Chinese government has created to keep going is a potential time bomb. And they’re sitting on a potential US$2 trillion in worthless paper."
Doug Casey, at the Crisis and Opportunity Summit - April 30, 2010

Korean Conflict

So where does this Korean conflict lead?

"Pyongyang rejected the claim as a "fabrication" and threatened war if sanctions were imposed. The international report found a North Korean submarine's torpedo sank the South Korean navy ship, causing the deaths of 46 sailors. China urged restraint and did not criticise the North. The US administration described the sinking as an "act of aggression" that challenged peace."
Source: BBC News


"Rekindle, reignite...it's all the same thing. My prediction on this one was that when the tide lowers, it's easy to pick a fight with an old foe. It usually takes a small spark."
Random Roving, March 8, 2009

China's Strengths

China continues to make the news as our chief competitor and financier. One of my email newsletters had some interesting perspective.

Robert Hsu claims that China's strengths are:

• China has little exposure to the problems we have here.
• China has no restrictions on spending stimulus money.
• China’s banks are stronger, with no subprime mess holding them back.
• China has over a $2 trillion surplus to spend as it sees fit.
• China has turned its growth internal with a $586 stimulus spending program.
• China has its own 1.3 billion-man market to sell to and a workforce that’s growing richer and spending money every day!

The Evolution Towards "Apart"

Another example that during a declining mass social mood, cooperation declines in perfect alignment.

"Google Inc, the world's biggest search engine, has been in a two-month standoff with Beijing over restrictions on the Internet and Google's claims that it and other companies were hit by hacking from within China. The company's chief executive, Eric Schmidt, said last week he hoped to announce soon an outcome from talks with Chinese officials on offering an uncensored search engine in that country of 384 million Internet users. Many experts have doubted China's ruling Communist Party would compromise on censorship, and on the weekend the Financial Times reported the talks had reached an impasse and Google was "99.9 percent" certain to shut its Chinese search engine, Google.cn. "Our forecast has always remained firm that once Google announced it would not accept censorship, then it was nearly impossible to imagine a scenario either where Google didn't act on that or the government accepted their position," Mark Natkin, managing director of Marbridge Consulting, told Reuters. Marbridge Consulting is a Beijing-based company that advises on China's IT and telecommunications sectors." Source: Reuters


My buddy, Bubbalew, continues to profess that during these difficult times, the "one world government" is going to take over. I believe that the opposite is ALREADY occurring. We are moving apart. Organizations like the European Union are in the process of "fragmenting". During an upward trending mass social mood, we make peace and sign peace treaties. We form cooperative organizations during these times and merge currencies. Now, the tide has shifted. Keep an eye on the EU. As Greece, Spain, and others continue to feel "the pain", their partners in the EU will continue to ask "why are we being dragged down by them?". In the US, you might hear similar rumblings with respect to states like California and Michigan. As stated prior, look for prior "cat fights" to reignite. I still find N. Ireland as an interesting one to watch due to the "Christian vs Christian" aspect of it.

Stay tuned.

The Vicious Cycle

My buddy JD turned me onto Thomas Friedman's book, "Hot, Flat, and Crowded". This is a great excerpt:

"At its core, the China-America growth engine worked like this: We in America built more and more stores, to sell more and more stuff, made in more and more Chinese factories, powered by more and more coal, and all those sales produced more dollars, which China used to buy more and more U.S. Treasury Bills, which allowed the Federal Reserve to extend more and more easy credit to more and more banks, consumers, and businesses so that more and more Americans could purchase more and more homes, and all those sales drove home prices higher and higher, which made more and more Americans feel like they had more and more money to buy more and more stuff made in more and more Chinese factories powered by more and more coal, which earned China more and more dollars to buy more and more T-bills to be recirculated back to America to create more and more credit so more and more people could build more and more stores and buy more and more homes . . .This relationship, so critical in inflating the post–Cold War credit bubble, was so intimate that when Americans suddenly stopped buying and building in the fall of 2008, thousands of Chinese factories went dark and whole Chinese villages found themselves unemployed."

Drinking The Poison

Bloomberg reports:
"Federal Reserve Chairman Ben S. Bernanke is prescribing 'poison' to the US economy by keeping interest rates near zero and fueling a wave of speculative capital that may cause the next global crisis, former Morgan Stanley chief Asian economist Andy Xie said. Bernanke is making decisions based on 'marginal considerations' that will help short-term growth and employment, instead of focusing on the 'soundness of the system,' Xie wrote in an e-mailed note. The next worldwide crisis will probably strike in 2012, driven by inflation as the low cost of borrowing spurs increases in asset prices, he said. 'There is a Chinese saying that one could quench the thirst by drinking poison,' said Xie, who predicted in September 2006 that the US economy would fall into a recession in 2008. 'Bernanke seems to be prescribing exactly this to the US economy. The slower Bernanke raises interest rates, the bigger the next crisis.' "

Back to The Economics of A Twelve Year Old

The Truth About Afghanistan

From F. William Engdahl:
"The second reason the US military remains in Afghanistan long after the world has forgotten even who the mysterious Osama bin Laden and his alleged Al Qaeda terrorist organization is or even if they exist, is as a pretext to build a permanent US military strike force with a series of permanent US airbases across Afghanistan. The aim of those bases is not to eradicate any Al Qaeda cells that may have survived in the caves of Tora Bora, or to eradicate a mythical “Taliban” which at this point according to eyewitness reports is made up overwhelmingly of local ordinary Afghanis fighting to rid their land once more of occupier armies as they did in the 11980’s against the Russians. The aim of the US bases in Afghanistan is to target and be able to strike at the two nations which today represent the only combined threat in the world today to an American global imperium, to America’s Full Spectrum Dominance as the Pentagon terms it."

"Afghanistan has historically been the heartland for the British-Russia Great Game, the struggle for control of Central Asia during the 19th and early 20th Centuries. British strategy then was to prevent Russia at all costs from controlling Afghanistan and thereby threatening Britain’s imperial crown jewel, India."

"Afghanistan is similarly regarded by Pentagon planners as highly strategic. It is a platform from which US military power could directly threaten Russia and China, as well as Iran and other oil-rich Middle East lands. Little has changed geopolitically over more than a century of wars."

The entire article:
http://www.financialsense.com/editorials/engdahl/2009/1021.html

The Worst Case Scenario

"When governments are confronted with dreadful domestic problems and faced with lack of oil supply, a foreign enemy will materialize who just happens to have vast amounts of oil. Since the supply of oil will be just as restricted for China and other Far East countries, there is likely to be armed conflict. Once war begins, no one can predict which direction it will go. If it spirals out of control, nuclear annihilation is a possibility. The collapse of the U.S. dollar would result in millions of Americans being financially wiped out. Millions of angry Americans with no gasoline and no money might get unruly. The possibility of civil war will be high. Will the American military fire on American citizens? The ruling elite will order the military to attack the riff-raff, but they risk the military turning their guns on them. The greatest risk in this scenario is that Americans turn to a strong leader who assumes dictatorial power in the guise of safety and security." James Quinn

The Attack on The U.S. Dollar

“The costs of a dollar-dominated system to the world may have exceeded its benefits. The dollar should ... be replaced by a new global reserve currency.”

Zhou Xiaochuan - China’s Central Bank Governor

“Replacing the dollar with an artificial currency would solve some of the problems related to the potential of countries running large deficits and would help stability.”

Dr. Detlef Kotte - Director of the UN's Macroeconomics & Dev. Policy

Changing of The Guard?

"This sounds like a dangerous prediction of a future economic war between the US and China over Middle East oil – yet again turning the region's conflicts into a battle for great power supremacy. China uses more oil incrementally than the US because its growth is less energy efficient. The transitional currency in the move away from dollars, according to Chinese banking sources, may well be gold. An indication of the huge amounts involved can be gained from the wealth of Abu Dhabi, Saudi Arabia, Kuwait and Qatar who together hold an estimated $2.1 trillion in dollar reserves. The decline of American economic power linked to the current global recession was implicitly acknowledged by the World Bank president Robert Zoellick. "One of the legacies of this crisis may be a recognition of changed economic power relations," he said in Istanbul ahead of meetings this week of the IMF and World Bank. But it is China's extraordinary new financial power – along with past anger among oil-producing and oil-consuming nations at America's power to interfere in the international financial system – which has prompted the latest discussions involving the Gulf states."
For the entire article:
http://www.independent.co.uk/news/business/news/the-demise-of-the-dollar-1798175.html