sunset from behind the wire

sunset from behind the wire

Tuesday, December 23, 2014

International Brinksmanship

Let's set the stage:

The Saudis by themselves set the price of oil not because they have the largest reserves (which they don't) but because they have the largest production capacity. They don't like the US all that much but are operating under the concept that the enemy of my enemy is my friend. 

Thus, they are squeezing America's adversaries in Russia and Iran by pumping and refining as part of the game of international brinksmanship now underway. If they pump, the US will protect them from ISIL and will ultimately intervene in Iraq to counter that threat. A us presence back in Iraq provides a hedge against Iranian Ambition.

Enter China. China isn't an American enemy. They are simply China and want to rule Asia, as they believe is their right as celestials. If you know a lot of Chinese people on the mainland, you'll get where I'm coming from. 

China created the Asian Infrastructure Investment Bank to trump Japan's involvement with the Asian Development Bank. Their $24 billion currency swap program to help Russia is also a sign of things to come.

Chinese President Xi Jinping's government doesn't care about upgrading economies, the health of tax regimes or central bank reserves. It cares about loyalty. The quid pro quo: For our generous assistance we expect your full support on everything from Taiwan to territorial disputes to deadening the West’s pesky focus on human rights.

The Federal Reserve’s inevitable tapering will hurt the Pacific rim economies and they will go to China for help. All China wants in return is their loyalty. So long as the US is COMPLETELY dependent on China for consumer goods (think Walmart, Target, Home Depot, Lowes, etc.), the Chinese can play the game without too much US interference.


2 comments:

  1. Fortune cookies are not Made in China. That's it I think?

    ReplyDelete

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