It’s the game folks. A global adaptation of monopoly and poker rolled into one. Up front in the “public” they simply do what all the other Criminal nations do.
Liang fu miankong in Chinese roughly translates to “two faced”. I find the word fitting when I look at what is happening in our world, versus what people think is happening. This seems especially true concerning China, and hence the reason I chose their words to start the letter.
On one hand we see them amassing huge amounts of solid gold, and encouraging their citizens to buy all they can. They continually tell anyone that will listen that the US is a currency manipulator, shouldn’t be a global reserve currency and that their own Yuan should hold part of that rank. They continually tell the US to get its own house in order before bossing other folks around. That’s good stuff!
On the other hand, their banking system, especially the “shadow banking” is as corrupt or even more corrupt than ours. At the National level, they’ve “created” more money than the US and Japan, and their bad loan portfolio makes JP Morgans asset book look pristine. They’re about to let some bad loans go belly up to the tune of about 500 million in losses and won’t help the investors get any back. “Too bad” comes to mind. In fact just Monday evening, they had to jam 12 billion in 7 day reverse repurchase agreements and 30 billion in 21 day reverse repo’s to keep their interest rates from soaring out of control. This is the same crap they blame us for. As loud as they scream that the US dollar is junk, they suck in all of them they can, shipping us trinkets to sell at Wal-Mart. What’s with the “two faces?”
It’s the game folks. A global adaptation of monopoly and poker rolled into one. Up front in the “public” they simply do what all the other Criminal nations do. They rob from the savers of “currency”, they print money, they make bad loans, they create feel good work programs and they make up economic lies. That’s their poker faces, playing along on the global ponzi stage just like Europe and the US. But it is the monopoly being played in the back room that we need to be aware of. Why? Because what goes on back there, tells the real story of what they think is coming.
At the very same time that China belly aches about how the US if devaluing its dollars, it is still sucking them up. The difference however is that they’re using them on the global monopoly board to buy up Park place. They’re buying up hotels. They’re buying up oil fields and US businesses. They’re buying gold and silver, they’re buying up art and buildings and roads and ore deposits.
When they say they aren’t going to take in more US dollars, that’s their poker bluff. Keep the world wondering. But in reality, they take in those dollars and run as fast as they can to spend them on real things. Tangible things. Things that can create material wealth. So, the two faces comes into play. They’ll gladly moan and groan about how bad the US is, how bad the Fed is doing. But they are simultaneously playing the monopoly board in the back ground. They know how the game goes. The folks that own the most properties with the most “hotels” wins the game. China plans to win that game.
The way the game is played is that all the major trading partners act the fool together. They’ve learned that if just one of them goes on a wild printing binge, it screws up their account deficits, inflation rates, and buying positions. So, with a wink and a nod the silent “secret code” is signaled and they “all” print bogus money. They’ve learned that as long as everyone is doing it in concert and no one gets too far out of line…they can keep kicking the economic ball down the road. But here’s the difference… only China appears to understand that the Ponzi poker game ends. That’s why they’re playing a mean game of monopoly in the back room.
The US Fed heads, politicians and imposters of economic intelligence, seem to actually believe the ponzi poker game can just go on ad infinitum, and we all sing Kumbaya and play with unicorns. The Europeans, having infested their own banking systems and politics with cast offs from Goldman Sachs and JP Morgan have also been led to believe in the utopian fantasy that you need no savings, you need no material wealth, you just need printed Euro’s, dollars, and Yen and you’ll bask in economic sunshine for ever.
There’s a very poignant reason that the Chinese have pressed their citizens to buy gold. There’s a very persuasive reason the Chinese have been sucking up hundreds and hundreds of tons of gold and not allowing any to be sold out of country. In their several thousand year history, they’ve seen a lot of dynasties. They’ve seen rises and falls, experiments of all fashion. But the perverted sense of the golden rule tends to outshine all. He how owns the gold, makes the rules.
They are quite happy playing the Ponzi poker game with the US, Japan, and Europe. They’ll go right ahead making stupid loans, adding on subprime assets and creating ugly debts. They know it ultimately means NOTHING to them. I assure you it will mean something to us.
Let me ask. Have you EVER heard a politician say that you should be amassing gold and silver for wealth preservation?? Have you ever heard a banker or a Fed head tell you to exchange worthless slips of paper for precious metals? Have you ever heard a Wall Street carnival barker say you should forget saving and buy raw land? Me neither.
That my friend is the big difference. While China is playing two faces, Europe and the US is only playing one. We aren’t encouraged to save, in fact they tell us flat out each day that everything they do is to encourage spending. We aren’t encouraged to question our Fed’s who create a trillion dollars a year out of thin air. The Chinese people are encouraged to trade in those slips of paper for gold. Save their money. Play global monopoly. Buy hotels.
Because we live in a “dot com” world of 30 second sound bites and “what did you do for me today” the idea of looking 4, 5, 8 years down the road has become foreign to many people. They’re okay today, they have a super bowl coming up, and as long as there’s beer in the fridge and food in the pantry, they’re “good to go”. We created that world by a hundred years of Madison avenue, TV, and the push to a “service” society. The Chinese however take a much longer view of things. A hundred years is like ten.
This global ponzi poker game will not go on for ever. The big reset is indeed coming. But, because it won’t hit tomorrow or next Saturday or next year, it’s completely out of mind for most folks. The Chinese know it’s coming. They’re planning for it, amassing wealth for it. So, when you see some of their shadow banking blow up, or their growth slow, or what have you, do NOT make the stupid mistake of thinking that they’re as stupid as we are. No, they’re not. They’ll let the one face do goofy things, just like we do in the US and Europe. They’ll make a big deal out of misleading statistics, or bad assets, or corrupt bankers. They’ll play the game.
But watch that second face. The Monopoly face. Watch the things they’re amassing, the resources. You’d do well to replicate their actions. I learned my lesson well during super storm Sandy. Water was worth more than money. Heat was worth more than money. I had wads of cash on me, yet I couldn’t turn on a single light, or run the fridge. I think the Chinese see that day coming too. A day where a truckload of US dollars won’t feed your kid. But that farmland they just bought in Brazil will.
Think about that.