By Jeff J. Brown
Pictured above, the currency symbols for the old Spanish peseta and the Chinese yuan. Maybe Baba Beijing can synthesize the two of them into a cool looking petro-yuan logo.
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[dropcap] A [/dropcap]fter 25 years of dreams, planning, rumors and testing, the Chinese petro-yuan is now official. Right now, almost all global oil trade is conducted in US dollars, using two benchmark varieties of crude, West Texas Intermediate and North Sea Brent, as the industry standards. It is no accident that these two benchmarks are based on imperial crude, American and British, and the irony of this is surely not lost on Baba Beijing (China’s leadership).
China is not selling oil, so the petro-yuan is a futures purchase contract denominated in renminbi for the country to import the stuff. As the world’s biggest importer of hydrocarbons, Baba Beijing has long felt that pricing all its millions of tons of imports should be in its national currency. Why should China pay for Russian natural gas or Venezuelan crude in Western empire’s currency of global financial control, Uncle Sam’s greenback?
Opinions outside China range from being non-plussed, to claiming it is the most important news in modern financial history, but you would have to search far and wide in Eurangloland (NATO, EU, Israel, Australia and New Zealand) and its heavily censored and suppressed media, to see for yourself. Silence from the West’s mainstream media is deafening, as this screenshot below shows, when searching the topic. Only one mainstream article showed up on page #1 of the web search and that was CNBC from 2017. Even just looking for “petro-yuan” gives identical results. It’s a Western media black hole.
The West’s censorship and suppression of news that reports the truth about China, Russia and Iran is lethally effective. Hitler called it the Big Lie. Eurangloland learned from a master.
Both end points on the above range of ideas are probably exaggerated. But, the fact that any global oil seller can now buy non-US dollar oil contracts is momentous, for sure. In 1971, Richard Nixon took the US dollar off the gold standard and got OPEC to restrict global hydrocarbon sales to greenbacks. Thus, overnight, the world’s reserve currency was pure fiat money, which is still being kept propped up by the need for the world economy to buy dollars, in order to purchase the most strategic commodity on earth. Here are two ranges of opinion on Nixon’s decision (https://www.forbes.com/sites/charleskadlec/2011/08/15/nixons-colossal-monetary-error-the-verdict-40-years-later/#70abb60669f7 and http://mentalfloss.com/article/12715/why-did-us-abandon-gold-standard).
Many people don’t want to acknowledge that their decision to switch from the US dollar to the euro, by Iraq’s Saddam Hussein and Libya’s Muammar Gaddafi, had a lot to do with their countries being invaded, plundered, destroyed, and then they being killed in a highly humiliating and public fashion (http://chinarising.puntopress.com/2017/08/28/why-dprk-will-n-e-v-e-r-stop-its-nuclear-arms-program-china-rising-radio-sinoland-170828/). In both cases, once they made the switch, it was just months before they were sacked.
Other, more powerful oil producers have already ditched the greenback, but Western empire only knows how to prey on weaker states, like Grenada, Panama, Serbia, in Africa and the like. Iran has already stopped using the US dollar (https://www.cbsnews.com/news/iran-ends-oil-transactions-in-us-dollars/), as has Russia with China (https://www.ft.com/content/8e88d464-0870-11e5-85de-00144feabdc0), which helps explain the West’s vociferous, self-defeating illegal sanctions and embargos on them.
Both Iran and Russia make Uncle Sam brown the backside of his red-white-and-blue bloomers, as well as for the Zionist state of Israel. I don’t even have to mention Eurangloland’s white knuckle fear of China. The China-Russia-Iran anti-dollar alliance versus the West is causing the latter’s elites to suffer from extreme geopolitical dysentery. Vulnerable, and it has to be said gullible Iraq and Libya, yes – but this towering trio not so much, as they are two of the world’s biggest petro-exporters next door to the biggest importer, and all are armed to the teeth with high-tech military hardware. When you look at the map below, it graphically shows how ridiculous it is for these three players to do business in dollars. New York and Washington are so far, far away.
Whatcha gonna do about it, Eurangloland? There’s not a damn this you can do, short of destroying humanity and the world. Sadly, there are many psychopaths in Washington, Brussels, London and Paris who would prefer that, than accept imperial collapse.
As usual, you have to go outside the Great Western Firewall and its propaganda Big Lie, to see the real world. For those who want to delve deeper, RT has done an informative series of articles and the South China Morning Post (SCMP) has done a couple of good ones.
RT:
https://www.rt.com/business/422314-petro-yuan-futures-dollar-death/
https://www.rt.com/business/422448-china-oil-futures-outstrips-brent/
https://www.rt.com/business/422472-russia-china-petro-yuan/
https://www.rt.com/business/422776-trade-war-petro-yuan/
https://www.rt.com/business/422838-petro-yuan-dollar-gaddafi/
https://www.rt.com/business/423461-petro-yuan-us-dollar-oil/
https://www.rt.com/business/424192-russian-producers-benefit-china-futures/
https://www.rt.com/business/424233-petro-yuan-dollar-death/
SCMP:
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Why and How China works: With a Mirror to Our Own History
JEFF J. BROWN, Senior Editor & China Correspondent, Dispatch from Beijing
Jeff J. Brown is a geopolitical analyst, journalist, lecturer and the author of The China Trilogy. It consists of 44 Days Backpacking in China – The Middle Kingdom in the 21st Century, with the United States, Europe and the Fate of the World in Its Looking Glass (2013); Punto Press released China Rising – Capitalist Roads, Socialist Destinations (2016); and for Badak Merah, Jeff authored China Is Communist, Dammit! – Dawn of the Red Dynasty (2017). As well, he published a textbook, Doctor WriteRead’s Treasure Trove to Great English (2015). He is also currently penning an historical fiction, Red Letters – The Diaries of Xi Jinping, to be published in late 2018. Jeff is a Senior Editor & China Correspondent for The Greanville Post, where he keeps a column, Dispatch from Beijing. He also writes a column for The Saker, called the Moscow-Beijing Express. Jeff interviews and podcasts on his own program, China Rising Radio Sinoland, which is also available on SoundCloud, YouTube, Stitcher Radio and iTunes.
In China, he has been a speaker at TEDx, the Bookworm and Capital M Literary Festivals, the Hutong, as well as being featured in an 18-part series of interviews on Radio Beijing AM774, with former BBC journalist, Bruce Connolly. He has guest lectured at the Beijing Academy of Social Sciences and various international schools and universities.
Jeff can be reached at China Rising,
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The gold standard, as much as some like to protest, wasn’t an economic panacea. Endless boom-bust cycles and the Great Depression all happened when dollars were able to be exchanged for precious metals. It is only one facet if economic policy. All currencies or credit systems are sociolegal fictions to make the distribution of work and resources more efficiently organised.
Thanks for commenting, Sergio. Unfortunately, the West’s central banks are keeping precious metal prices artificially suppressed, to maintain a very overvalued US dollar and euro. The whole economic system is rigged.
Live from China, Jeff