Hong Kong – The Battleground for the Hegemony of Dollar
Since the 1970, it has always been about the Dollar – specifically its role as the world’s Reserve Currency and the Petrocurrency – currency of settlement for petro-contracts. US supremacy, and its exceptional status, both depend upon the global acceptance of dollar in its designated role.
Dollars’ supremacy is a matter of life and death to the Ruling Elites of the US – No challenge to the dollar’s hegemony has gone unanswered – Iraq and Libya are the two latest reminder to the world; don’t mess with the dollar.
Now, China is posing a mortal threat to the supremacy of dollar. With its enormous manufacturing base and ferocious appetite for the raw material, China has emerged as the largest single trading partner to almost every significant country in the world, It is using this leverage to settle the bilateral trades in Yuan, and in the currencies of its trading partners. China has been striking agreements with many of its trade partners to do business using each other’s currencies. China and Russia, China and Brazil, China and Australia, even China and Japan — they all have currency swaps and other arrangements in place to bypass the dollar. That in itself is a very worrisome state for those who have to be worried.
On the global front, the perception has also changed. Many countries are realizing that using the dollar as the trade settlement currency is a lose-lose game for them – They become dependent upon the western banking institutions, and vulnerable to the arbitrary sanctions at the whim of the elites in Washington. Further, they end up accumulating the paper notes that have zero baking.
With a revitalized BRICS – producing almost 50% of the real global GDP in terms of the Purchasing power parity, the world has found an alternative to the dollar. And, China, with its large exchange reserves, is in a position to offer this alternative to its global partners. BRICS are posing a great threat to the supremacy of dollar.
The Petro-Kingdoms and Sheikhdoms are also seeing the signs on the sky. China has emerged as their largest customer, surpassing the US. The Arab oil kings and sheikhs are realizing that they have more dollars than they know what to do with.
The question is; how long will they want to keep all those dollars lying around? Especially, when Asia-Pacific now account for more than one-third of global oil consumption.
The fact is, the petrodollar system is already on the verge of breaking down – oil is no longer paid for in dollars alone. This trend has the potential to put the death knell to the U.S. dollar as the global reserve currency. It is a serious situation.
The Ruling Elites in Washington are very nervous for quite some time now. The episodes of their nervous breakdowns have been on display in the theaters of Arab Springs and the fiasco of Ukraine – and, there seems to be no end to these episodes.
With the senseless, witless, and thoughtless sanctions on the Russian businesses, they have ended up forcing the Russians to pull away their money from the dollar-denominated accounts in the EU banks, and transfer them to the banks in Hong Kong – converted into Hong Kong dollars.
And, that was on top of the Cyprus bail-ins, and the hefty arbitrary fines on French institutions.
The world has started seeing the folly, and the dangers, of settling trades in the US dollar.
Destination Hong Kong
The combined effect of all these events and factors was to initiate a panic exodus of capital from the dollar-denominated western accounts. Hong Kong offered the only alternatives to these fleeing billions of dollars. Hundreds of billions of dollars worth of capital – from the Russian oligarchs to the Petro Kings and Sheikhs – has since been flowing into the Banks in Hong Kong. And, that despite the occupy central protests and the strict scrutiny by the HK banks.
With the Rothchildian stigma on Dubai – There is no other alternative to Hong Kong. Hong Kong has emerged as the banking paradise for the businesses – from the legit ones to the crook ones. It is practically – affording them Chinese protection, and, at the same time, access to the emerging Trade Settlement Exchange in Shanghai.
In its new role as the global Banking Center, Hong Kong poses a great threat to the supremacy of the dollar – which is a direct threat to the US Supremacy. Lucky for the Hong Kongers – and thanks to the Chinese might, Hong Kong cannot be freed the Libyan way. The only option available to the Elites is to destabilize the island in hope that it will scare away the capital flow into Hong Kong.
The Dollar’s Supremacy has never been threatened like that before. It is facing some formidable enemies. With the perspective of the Western Elites, Hog Kong has to be pacified – This is the war for survivor.
The Empire has deployed all its assets in Hong Kong. It is a battle that The Empire cannot afford to lose. The protest in Hong Kong may just be the beginning. Expect more to come.
Unless, of course, an accommodation is made.