Here we are at the end of 2014 and about to kick off the new year. Many writers take this time to do a recap of the year or even make predictions of what may happen in the next 365 days. I thought I’d have a go at what I believe will be the most important event yet to happen. Namely, this “face off” between Obama and Putin will come to a head.
Let me begin by explaining that Putin, like him or hate him, is no idiot. The man is a chess Grand Master and in regards to the rough and tumble world of Russian politics, it takes a pretty crafty individual to rise to the top of the heap. As the former head of the KGB, he’s no Johnny-come-lately to the geopolitical world. Compared to Vladimir Putin, Barack Obama is a rank amateur.
Recently, the globe has experienced a sudden drop in oil prices. This was all simply the law of supply and demand. Specifically, the alliance of the Saudi Arabians and the US State Department. Much to the chagrin of their OPEC partners, the Saudis have agreed to over produce oil in order to drive down it’s world market price. The idea was to recreate the same scenario that brought the old USSR to her knees in the 1980s by the Reagan and H.W. Bush administrations. But, yet again, the brilliant US government and their crackpot team of Keynesian economists continue to overlook the long term consequences of such a short sighted policy.
The US government’s attempts to cripple the Russian economy by destroying the ruble is beginning to fail. Believing that Russia was isolated from world markets was laughable at best. Coming to Russia’s side, China decided to stop sitting idly by and do something about this overt aggression on their neighbor’s currency. China’s Finance Minister Lian Ping, announced that China’s central bank was opening a currency swap for an estimated 150 billion US dollars in order for Russia to swap rubles for yuan. After the news broke on the South China Morning Post, the Russian currency strengthened by some 30 percent.
In a recent interview on King World News, former US Assistant Treasurer Dr. Paul Craig Roberts explained that Putin has four “black swan” options he could make to counter the US government’s move on the world chess board.
- It’s estimated by 2015, Russia will have a debt obligation to several European nations to the tune of some 20 billion dollars. Putin could simply explain to these creditor nations that due to the recent political attacks on the Russian currency, they would stop payment on the debt for about a year. This would cause a shock throughout the European banking sector, causing a domino effect of bank failures.
- The COMEX and all of those unbacked naked shorts! Russia could purchase most of the naked shorts in the COMEX by JP Morgan, Goldman Sachs, Citigroup, The Royal Bank of Scotland, et al, and demand delivery of the gold and silver it had just purchased. This would expose the COMEX for the fraud that it is, as nothing more than a derivatives market, and cause a default. Imagine the fall out on world markets of trillions of dollars of derivatives exploding overnight. This would make the 2008 financial collapse look like a just a few foreclosures.
- Russia could just simply let the ruble fall. As the Russian currency weakens, the dollar strengthens in comparison. In turn, Putin would sell Russian oil on the market in dollars, just as the US government likes it, and then buy up rubles. Once Russia is satisfied that it had removed enough rubles from the foreign banks, Putin could then turn around and demand payment exclusively in rubles for Russian oil.
- Russia could refuse to sell oil to NATO member countries. The result being, a break up of NATO and possibly even Germany leaving the EU and causing the Union’s demise and the destruction of the Euro. The weaker European nations may also want to join the trade agreement within the BRIC nations, strengthening not only Russia’s position, but China’s position on the world stage.
As Putin sees it, he doesn’t have to target the US directly. He has her allies in Europe who are desperately dependent on Russian oil and natural gas. The Europeans, on the other hand, are fully aware that they being caught in the cross fire of this geopolitical game between the Americans and Russians. Believe me, they don’t like it and are becoming quite reluctant to continue playing. After all, who wants to be a pawn anyway? If the NATO countries bail out of the pressure cooker their big brother in America has put them in, this would cause the collapse of any crippling of the Russian economy. It would also spell disaster for future ambitions of US hegemony in the world. Worst yet, a violent reaction may erupt from the US in answer for getting egg on their face.
Being an amateur chess player myself, I would never consider challenging chess Grand Master Garry Kasparov to a game where I bet the farm on it’s outcome. After witnessing the State Department’s failure in Benghazi and it’s failed attempt to frame President Assad for the chemical attacks in Syria, arming ISIS and aiding them to usurp Iraq, I’d say the US winning this chess match against Putin holds the same odds. Just to be clear, unlike our foreign policy, I wouldn’t stand up and shoot Kasparov from across the table at the first sign of defeat.
Oh, almost forgot, Happy New Year!
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