The Decline and Threat of America

Everything hinges on the value of the Dollar.

Now, a currency is only worth what one can get for it. Well, America no longer produces anything, and with Global Warming messing with the weather, America might soon not even be able to sell wheat, soy, corn and rice. Such commodity sales are the last remaining healthy factors in the grand formula of American Trade, and so we should view any decline there with great trepidation.

The only thing left remaining that America would have to sell, in order to support the Value of its Dollar, is the ownership of its companies and its real estate. But would America have the will to bring itself to sell off its ownerships in just about all of its companies?

It had once almost happened before, with Japan, in the late Seventies. Remember, before China became Manufacturer to the World, it was Japan, and Japan had amassed a huge supply of Dollars. It stuffed many dollars into its Currency Reserves, just as the Chinese are now doing, and even after buying all of its energy and petroleum needs with Dollars, still had many Dollars left over, and so began putting them into American Companies and Real Estate. The most startling instance of this was when Japan bought controlling interest in, yes, Bank of America. Almost at the point of American Political Reaction, when grumbling in the streets was beginning to foment some political focus, Japan collapsed into a recession from which it still has not fully recovered. It was bad for Japan, but it saved the Dollar and put an end to the political grumbling, at least for the moment.

It had been a close call. You see, if America would have enacted some kind of protectionist legislation, prohibiting foreign nationals from purchasing American Companies and Real Estate, then the dollar would have collapsed back then. After all, if Foreign Countries are not allowed to spend dollars in America, then of what value are they?

The situation is much the same with China now, only bigger. The Chinese are playing a complicated and somewhat circular game – they are lending a great many Dollars back to America, thus keeping America’s economy from collapsing, which also allows Americans to purchase more Chinese goods, sending more dollars to China. Stuffing their dollars into Currency Reserves serves one very important purpose – it keeps the dollars out of circulation which keeps the value of the Dollar and of their own Dollar Reserves higher than it otherwise would be. But the Chinese must be clever enough to see the paradox here – that the Dollar is only worth something as long as they don’t try spending it.

I suppose the Chinese are biding their time, but I can’t really guess why. The Dollars present value, as high as it is after considering all of the factors that should be depressing it, is a kind of an Economic Bubble. And in all Economic Bubbles, the people who come out least damaged in the end are the ones who Sell first, cashing out before the panic sets in. If the Chinese wait for some other factor to take them by surprise, collapsing the dollar first, then they could end us sitting on Trillion Dollar Reserves that aren’t worth the paper they are printed on. Heck, all it would take is Saudi Arabia changing the Oil Currency to Euros, and the Dollar would collapse the very same day. And we can’t suppose that there are not hundreds of Saudi Princes all working toward that very same end … understandably or not resenting America’s War against Islam and the stalwart, absolute and unquestioned political and economic support that America provides for Zionist Expansion. With such forces afoot, every day that China waits could be the Dollar’s last.

But it is all very worrisome. The choices are not simple or easy. Spending Dollars could cause more problems then it is all worth. It puts me in mind of Pre-War Germany. Germany’s economy was put into rather shaky circumstances by the one-sided settlement agreement for the First World War, and the Banking Elites in both Germany and Internationally saw an opportunity – they restricted hard currency transfers to Germany, forcing the Germans to print unsupported money that was appraised at lower and lower value as it went along. When the Deutsch Mark finally collapsed entirely, the Banking Communities swooped in with relatively little amounts of gold and silver and bought up everything in sight. Although there had to have been many Christian Bankers in the mix, the most visible standouts were the Jewish Banking Families which had already caused something of a scandal by openly working with the American Government against Germany during the War… even while some of their own family members till lived and worked in Germany. It had every appearance of Treason. While the Economic Collapse and the subsequent “Rescue”, which resulted in a massive transfer of Ownership to Foreign Agents, may have all been an unplanned and unforeseeable accident, which is how History plays it, still, if it had all been a well laid trap, it could not have gone off better. But what was probably not planned for was that the German People became extremely angry, and for years could not get over it, finally resorting to extreme and radical Nationalist Politics which almost everybody admits turned out very badly for nearly everybody.

So, who in their right mind would wish to do it all over again, this time casting America in the roll of Crazy and Bitter Nationalist War Mongers?

With Germany, it took them about 10 to 15 years to assemble a military apparatus large enough to be worrisome. Really, only the French had foreseen such an eventuality, and nobody listened to the French. So the great extent of German Military Nationalism came as something of a surprise. But America offers a very different prospect. America now has more Military Equipment than all of the rest of the world put together, and is showing no signs of ever decreasing its procurements. And, yes, while America currently has a President that enjoys the trust of the rest of the World… that he won’t go crazy and order the bombing of every Capital on the Planet for not sending the Olympic Games to Chicago, still we need to wonder how long this American Political Moderation will last, especially since Political Moderation has now gone a full year while accomplishing virtually nothing. Those who rallied for Political Moderation are now discredited and demoralized. The Right Wing Fanatics will certainly capitalize on the failures of Moderation, and the next ‘Decider’ in the White House could be just as crazy as anybody Germany could ever have imagined, and this time with an Army, Navy and Air Force with a thousand times the destructive capabilities of anything Germany had at the absolute heights of its power and dominance.

So, probably the least worrisome thing China could do with all of their Dollar Reserves would be to simply funnel it all back to America in the form of Loans and Bond Purchases. I admit that it would seem like such an odd and unprofitable plan – to go through all the trouble of being Manufacturer for America and then never being able to spend any of the profits. But they are attaining a certain level of benefit throughout. They are buying up Manufacturing Capital, Technology and Machinery and even putting in place their own Research and Development Facilities. They are doing alright for themselves.

But there is one important thing China needs to keep in mind, and that is that never in a million years will America ever pay off that Huge Debt. Indeed, the way Banking works is that nobody even expects that the Principal, the initial amount of a Loan, should ever be paid back, just as long as the Interest on the loan continues to be paid (over years and years the continual payments of interest more than cover for the original principal of the loan). But at the rate at which America’s borrowing is going, there will soon arrive a time when America will no longer be able to pay even the interest on its loans. Already America has resorted to borrowing to pay the interest on some of its Loans… they call that ‘re-structuring’ but it is really just the prelude to downright bankruptcy, like what happens when an individual has to use one credit card to pay another. The end is near.

Anyway, China needs to look ahead and come up with some calm and cool contingency plans for dealing with the moment, not ‘if’ but, when America announces that it is reneging on its loans and renouncing its bonds.

But, really, what are the chances that cool heads will prevail. In a way it is kind of ironic. America had opposed Communism in both China and Russia, instead preferring the victory of Nationalist Political Factions. International Communism might have seen the utility of coming in and helping America with some International Scheme of some sorts. But the partisan Nationalists from all around the Globe that America had supported will simply wonder whether it isn’t just their lucky day that America has finally collapsed. You see, that is one of the problems with advancing Greed as a Virtue – once it is given to Another, it is likely to turn around and bite.

So, it is extremely worrisome for me, that even with the apparent backdrop of a successful Globalization, the most powerful developing Economies are becoming more and more Nationalistic – India with its Right Wing Hinduism, China with its Ethnic Han Supremacy, and Russia who really must feel screwed over by everything and nobody needs an essay explaining why they should feel pissed off.

Anyway, to sum it all up, when things finally collapse, I don’t expect that events will be met with calm heads and even reasoning. Just as the Twentieth Century had defined itself with all the rushing off into Wars and Holocausts, well, now I see about the same prospects for the Twenty-first Century. No Messiah came forward to stop it then, and so it would probably be unrealistic to hope for any Second Coming to save us now. Yes, after a Black Man became President of the United States, we are probably all out of Miracles.