Is QE2 all about forcing China into the waiting arms of a “rescuing” clan of global governors who desperately need China to join them?
It is beyond doubt that the the money printing of QE2 will devalue the worth of the trillions in U.S. debt held by China. QE2 must have China in a panic. Steve Horesting, a Washington D.C. insider, questions whether QE2 is a scheme, promoted by Kissinger and Soros, to drive China into a global currrency plan that will ultimately dilute the economic power of the Chinese.
Horesting, who was Chief Counsel to FEC Vice Chairman Bradley A. Smith (2000-2003), General Counsel to the National Republican Senatorial Committee (2003-2004) and Co-founder, Center for Competitive Politics (2005) emails me his full argument which can be found here.
Horesting's argument is interesting, setting aside the fact that he obviously has some major "one-sided political hack" skin in the game which makes some of his specific claims about the "Left" and the unique nefariousness of a Democratic presidency/Congress a little hard to swallow.
ReplyDeleteI think more than anything, Horesting's piece had me wondering what the hell the Chinese were thinking in the first place? I mean, what did the Chinese think they were going to eventually get paid back in, gold? Unicorns? I am being serious, I have trouble understanding how people can create institutions and operate them for decades that they seem to know nothing about. The Chinese were never going to get paid back in anything more final than more dollars and more debt.
The behavior of the Chinese really only makes sense within the context of short-run thinking of specific politicians who created and operated the exchange system over the years and sought to benefit materially and politically from it while assuming its eventual implosion and day of reckoning would always be someone else's problem and not theirs. Similarly, it makes sense when you see how such a scheme allows them to get away with all kinds of manipulations, power brokerage and regimentation of their population and economy within their own internal system.
Otherwise, it is silly. Why in the hell trade real goods and services for paper tickets whose supply is potentially infinite and which will never be paid back in real goods and services?
Taking this all one step further, I enjoyed Horesting's suggestion that this is a plot to force the Chinese into the NWO (or is that a nwo? I couldn't tell if it was the Proper Noun NWO or just a regular noun, general nwo) while they're looking to extricate themselves from such financial finaglings. But that raises another question-- what alternative system might the Chinese try to create for themselves that wouldn't be as similarly arbitrary as the current one (or the IMF/nwo one) and that wouldn't eventually lead to the same economic and political issues. Does anyone seriously believe that the Communist Party of China is going to obliterate its own control over its economy and people by renouncing its use of the printing press and going to a hard, commodity-money standard?
If they don't do that, they don't really improve the situation. Maybe they avoid a US debt collapse but the Chinese debt collapse will always be just over the horizon instead.
Meanwhile, let's never forget Marc Faber's theory/suggestion that the Chinese might purposefully and/or willingly let the value of their US Treasury debt fall to zero, accepting the financial loss as the mere cost of destroying a competing world power without having to resort to force of arms. All told, it does seem a much cheaper and more efficient way to dominate other countries than to waste $2T getting your soldiers killed all over the globe.
All of this stuff is pretty wild to think about!