As we kickoff this week’s trading with a roughly $2 billion takedown in the paper gold market, it appears that China’s move to dominate the world will include a gold-centered monetary system.
Enter The Golden Dragon
(King World News) – Dr. Stephen Leeb: “One headline after another shows how the U.S., torn by partisan politics, is making a mockery of itself. Three decades ago, during the Reagan administration, the Senate passed tax reform with 74 “yes” votes. These included a majority of Democrats. Today the legislative process has been depressingly cheapened. If the hastily drafted massive and messy tax bill passes, it will be without a single Democratic vote in the Senate and perhaps the House as well.
President Trump’s trip to Asia provides abundant further evidence of our decline. While Trump reveled in the pageantry, Asian leaders politely made plain that China now calls the shots. The next stage will be implementation of a new monetary system centered on gold, as we’ve discussed often before.
A striking takeaway from the trip was that China wasn’t once seriously challenged over its takeover of islands in the South and East China seas. Why didn’t the U.S. make an issue of the islands, which are critical to control of the East? Because we can’t. As I’ve discussed before, we simply don’t have the military assets to challenge China’s control.
Some said at least the trip led to China agreeing to work harder to persuade North Korea to give up its nuclear weapons. Really? South Korea’s President Moon Jae-In, a key U.S. ally in the East, has said it’s unrealistic to think the North will give up its nuclear weapons. At best it might freeze further development with complete denuclearization a long-term goal. Meanwhile, President Moon and China’s President Xi have agreed to a bilateral summit next month in Beijing. For good measure Moon invited Xi to attend the forthcoming 2018 Winter Olympics that South Korea is hosting.
It’s true that China sent an envoy to North Korea, a move that the Asian Review headlined as “China likely seeks diplomatic coup with North Korea envoy.” That coup would consist of negotiations between the U.S. and North Korea leading to a “freeze for freeze” agreement. In return for North Korea freezing further nuclear development, the U.S. would cease joint military exercises with South Korea.
But it’s ludicrous to term this potential scenario a win for the United States. Rather, as I’ve said before, it’s what China has always wanted, an outcome that would leave China dominant in the entire Korean peninsula. With South Korean-Chinese relations improving, the odds of such dominance have shot up.
Japan & China
Moon isn’t the only Asian leader cozying up to Xi following Trump’s trip. While the front page of Friday’s New York Times focused on the multiplying sex scandals, page 9 carried a more significant story. Over a photo of all-smiles Abe and Xi shaking hands was the headline: “Wary of U.S., Japan and China Move to Mend Ties – Power Balance Shifts in Asia.” The Japanese press picked up on Xi’s smile, which starkly contrasted with his stony face in previous meetings with Abe.
Hugh White, professor of strategic studies at Australia’s National University, summed up the situation in a recent column in a Hong Kong newspaper. As White put it:
“No matter who is president, the U.S. will fail to resist China’s skillful and relentless campaign to ease America out of Asia and take its place. And that is the reality that China’s neighbours need to start thinking about much more seriously. Whatever their problems with China, America will not be the answer.”
China’s Fierce Military Buildup
Part of China’s “relentless campaign” has been its fierce build-up in its military capabilities. Trump’s silence on China’s activities in the South China Sea amounted to U.S. surrender.….more here