Economics - Cras In Transitu 明天轉型 June 10, 2014 JC Collins
Supra-Sovereign Gold and the Great Consolidation By JC Collins
Look at everything that exists, and observe that it is already in dissolution and in change, and as it were putrefaction or dispersion, or that everything is so constituted by nature as to die. – Marcus Aurelius, Meditations, Book X. 167AD
The human mind and contention are common bedfellows in that they both seek sameness and comfort in the patterns of everyday life. These patterns are expected to solidify and secure expectations and predictions based on what came before. Yet, what came before is seldom more than a temporary marker of what is to come.
Tomorrow is seen as an extension of today and the economy of tomorrow is a result of yesterdays indicators. The subtle changes to those indicators are not noticed or extrapolated outside of the economic metrics themselves.
The mind partitions life into recognizable segments which it then uses to define not just economics but also all matters of consequence, from the intellect to emotions. It is expected that contention is the primary product of recognizable sameness.
These processes within our life individual are micro semi self contained silos of inner satisfaction. Each is managed externally by macro forces which serve to re-enforce the separateness of sameness. Though this may at first be interpreted as a contradiction, upon further retrospection the obviousness of it becomes consciously apparent – we are separated by sameness.
This sameness serves us the desired expectations on the functioning of reality. The expectations, or conditioning, affirm consumption and interaction with interaction manifest as a simulation only. We are separated from each other as well as separated within ourselves. Symbiosis between micro and macro create simulated sameness.
Often times simulated differentials can also be manufactured to enforce and encourage a continuation of sameness. In this case symbiosis between micro and macro simulate opposition.
For the purpose of continuing the sameness of sociological and economic sameness we are presented with the simulated opposition as defined by a spectrum of manufactured differentials.
Economically manufactured differentials are visible today on the geopolitical world stage. We are told to believe that the west and east are at odds on economic policy and the monetary restructuring of tomorrow. Yet all actual evidence is to the contrary.
In the post The Bankers Midwife it was explained how all central banks are held within the structure of the Bank for International Settlements. It has been well covered here and elsewhere how China and Russia, among a host of other countries, including the G20, are calling on reforms to the International Monetary Fund to facilitate the implementation of a supra-sovereign currency.
The forthcoming BRICS Development Bank is being presented as the differential opposite from the west dominated IMF. Conspiracy blogs and polarizing economic analysts solidify the propagation of this oppositional simulation.
Publications and data of the global institutions themselves contradict this simulation of differentials. A continuation of sameness is the desired outcome of manufactured opposites.
The transfer of gold from west to east is being presented as an actualized differential when in fact it is the simulation of such. Considering the interconnectedness of the international banking system and how sovereign debt is the method of money creation (the simulation of wealth) from country to country, and the policy vanguard of the Bank for International Settlements centralizing all central banks, are we to believe that the obvious sameness is the simulation as opposed to the manufactured differentials?
The International Monetary Fund, the holder of tomorrows supra-sovereign currency, is being presented as incompetent and unable to accurately predict tomorrows metrics based on yesterdays indicators.
This is for the purpose of stimulating a desired response of necessary transformation surrounding the Executive Board as defined in the 2010 Quota Reforms. These reforms will be enacted at year end with China being the first of the emerging economies to be added to the SDR basket of currencies.
Meanwhile, the Managing Director Christine Lagarde is discussing how the IMF will eventually move its operations to China as a reflection of the changing economic realities of the financial landscape.
This transition of the IMF from west to east fits with what we have previously discussed. In the post The Last American Alamo it was stated that the People’s Bank of China Governor Zhou Xiachuan would be the first non-European Managing Director of the International Monetary Fund.
This is potentially actualized by Ms. Lagarde’s non-oppositional statement about a move to China.
The Chinese currency, the renminbi, began its internationalisation in 2010, the same year the IMF Code of Reforms were agreed upon. Since then the RMB has been aggressively positioned as the simulated differential from the debt ridden US dollar, even though all countries have extreme sovereign debts, including China.
Frankfurt has become the first of many official RMB trading hubs with Sydney, Toronto, Vancouver, San Francisco, Singapore, and London soon to follow. The London hub is ever more likely as Europe is showing early signs of transitioning away from the US dollar and accepting rubles and renminbi, along with the Euro, in trade settlement.
This actualized policy shift will result in a separation between England and the European Union to satisfy the underlying sameness of the emerging multilateral system.
Other evidence that the separation of west and east is manufactured is the soon to be implemented CIPS, or China International Payment System, which is built upon the SWIFT system and will use ISO 20022 for the clearing of RMB trade payments.
Take all of the above and add it to the fact that Governor Xiachuan has previously called for the emergence of a multilateral financial system dominated by the SDR of the International Monetary Fund and does it honestly look like an actualization of differentials or the simulation of oppositional sameness?
This simulated breakdown in geopolitical agreements will encourage the much needed paradigm from which the multilateral system can emerge.
Namely, the chaos evident when countries begin to transition away from the dollar standard and attempt to settle trade payments in their own regional currencies.
Without the structure of a standardized reserve system there will be economic imbalances and rampant highs and lows across the economic indicators spectrum. The clamor for a standardized system will be quickly followed by the announcement of the SDR supra-sovereign currency structured around a multilateral financial system.
The sovereign debt of all countries will be restructured through the Sovereign Debt Restructuring Mechanism part of the new system, as previously detailed thoroughly on this site. See post A Global Currency Reset and related links.
Returning to the gold transfer from west to east, let’s consider that the international banking system is controlled and defined by an actualization of sameness, as represented in the Bank for International Settlements, and determine what is indeed taking place with this movement of gold, if anything.
On the micro level there appears to be a simulated transfer of wealth between sovereign entities and central banks. But on the macro level the sameness is apparent and tells a tale of a non-event.
The likely purpose of the mass movement of gold is to facilitate the actualization of the multilateral system. A supra-sovereign currency will require the balanced placement and utilization of gold storage throughout the geographical system.
This secures individual sovereign segments of the system to ensure full participation and support indicator metrics.
Given the possibility of civil unrest in America it is also prudent to safeguard gold reserves from the potential of mass disorganized theft. Securing of military hardware and nuclear technology is also an important part of implementing the multilateral system, for which measures have been put into place.
Gold, for its part, will become a part of the supra-sovereign multilateral system with no one country or singular grouping of countries taking the lead in leveraging gold reserves over others or the macro system as a whole.
Those proclaiming $10,000 gold are unwittingly ignoring the fundamental actualization that gold neither goes up or down in value, it only maintains value and purchasing power as set against other anchors, such as fiat currencies.
As an example, for simplicity sake, one ounce of gold is worth 1 dollar. Your employment earns you 1 dollar an hour. True wealth is your time and labor. You work 5,000 hours and make 5,000 dollars. You choose to transfer that 5,000 dollars into 5,000 ounces of gold. Same value and purchasing power.
Now lets say that the dollar is devalued by 50% through unregulated money printing. Because of the lesser value of the dollar the price of gold goes up to 2 dollars an ounce.
You can still only afford to transfer 5000 dollars worth of money into gold wealth, which gets you 2500 ounces of gold. A dollar is still a dollar but now it buys you only 2500 ounces of gold.
As long as you have an equal wage increase to the inflation, your true wealth doesn’t increase, purchasing power stays the same. Gold is the only true method of maintaining your wealth. Building wealth with gold on the other hand is problematic and time sensitive and highly unlikely to be workable in a longer time frame and macro economic situation.
As the multilateral financial system further emerges the level of sovereign debt will be restructured through the SDRM and gold will slowly come down from its current value. It will maintain its purchasing power lock step as the money supply of the world is reduced to accommodate the necessary deflationary component of the emerging system.
All economic indicators are suggesting a period of deflation and sovereign debt consolidation. This stands in opposition to the sameness of inflation and increasing debt which we have experienced for the better part of 50 years.