I think Chiefio makes an interesting association between executive powers being migrated to the permanent bureaucracy and these counterproductive sanctions. Didn’t realize, moreover, that China is getting out of US bonds, while the Saudi’s are dumping the US stock market:
Sanctions On China (via Russia) – Buy Junk Now.
Posted on 17 June 2024 by E.M.Smith
Intro
Whoever is running the US Government is busy moving as much power as possible from the office of the President to the Permanent Government of the Bureaucracy. This is being done to “prevent” Trump doing anything when he gets elected, and because they can do this with Biden in office since he is too clueless to protest it.
Secondary Sanctions
The US has now empowered the Treasury to put “sanctions” on anyone (Banks, Companies,…) who supplies anything in the way of support to Russia, via declaring that Russia is running a “War Economy” so the whole economy is OK to target.
This, then, points the Sanctions Weapon at Chinese Banks and Industries… And also lays the groundwork for direct sanctions on China once the TLAs tell congress / POTUS to start a war with China over Taiwan.
The idea is that this will break Russia via breaking their dependence on China.
But 2 problems with that idea.
Russia is not dependent on China, we in The West are. (Over 90% of medicinal chemicals come from China now, as one example. Rare Earths. And a whole lot more.)
This will push Russia and China closer together, not further apart. It will also push a whole lot more countries into the BRICS+ sphere. 59 at last count waiting to officially join (and move away from the Colonial Abuse of the EU, UK, and USA systems).
Sidenote: The Russian Stock Exchange is now pricing, and clearing, with Yuan instead of $US since the $US is no longer stable from their POV. Ever more things in Russia will now have Yuan benchmark prices.
Note that China is down from over $3 Trillion of US Treasuries to $750 Billion or so. These are likely Short Dated (less than 10 year maturity) and will “run off’ even if not sold outright.
Note that Saudi Arabia has sold about 1/2 of their TOTAL US Stocks. (It isn’t just the $US and US Banks that are now untrustworthy, but Stocks held in brokerages as well). Expect a whole lot of other countries to be moving out of ANY Financial Instrument subject to US Sanctions (or EU freezes or confiscations…)
These folks are not dumb, so will be moving out of those positions in a very controlled way so as not to crash prices.
Where will they move their money & stocks? Into BRICS+ nations and Banks, I think.
FWIW, I’m using Brazil and India for my BRICS+ investments. Mostly just due to Russia being unavailable to me in the US markets, and China being less trustworthy than I’d like (a long history of adulterating products and materials, spying, and capricious rules changes by the Communists running the place).
There are likely also some banks in places like Malaysia, Cayman Islands, etc. that will benefit from a rapid run “off shore”.
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I’d expect a lot more stock buys from folks like The House Of Saud, to be into Chinese and Russian companies, but also India and Brazil. Then there will be direct investments into places like Africa and South America where I can’t “take a stake” as it isn’t an exchange traded product and might have the USA ban it anyway… But, as usual for all things stocks “We’ll see” and we will let the charts be our guide.
So, IFF you have a pile of $US and you have things you expect to need in the next 1/2 dozen years that are largely made in China; best to convert those $$ into “stuff” and put it on the shelf (assuming it stores well…). Between ongoing (and rising soon) inflation, decreasing supplies (due to sanctioned companies), and prices shooting up suddenly (punitive tariffs applied suddenly). That’s my POV and what I’m going to do for me (you do you based on your needs and abilities). So going shopping for some tools at Harbor Freight, getting any “kitchen ware” and appliances I think I might need, looking at the replacement vacuum cleaner, making sure my stock of canning jars, lids, pressure canners, etc. are good for a decade or so worth of use, making sure all the tires on cars are new-ish and getting that oldest car painted (most paint chemicals no longer come from the USA…). You get the idea.
So “Going Forward” I’ll likely be making some postings of graphs of Indian and Brazilian company’s stocks vs EU / UK / US stocks. I’ll be avoiding any US & EU Bonds (and likely and UK bonds as well). The last US Treasury Auction was something of a dud, and The Fed ended up buying a lot of them – this is, IMHO, likely to get worse.
So, in addition to “stacking” metals, one ought to also consider “stacking” things you expect to buy in the next few years ( I need some more shirts, shorts, & pants for example – so buying a decade worth since my size doesn’t change much
along with the usual “collectibles” that go up in times of inflation: Gems, art, etc.
I don’t see anything at all moving against this onslaught. The Greens and GEBs are busy destroying Western Industry, Western Financial Systems, Western Currencies, and more. This will result in a hard recession (perhaps even reaching depression if done long enough) so I’d not buy Real Estate until after that finishes crashing (usually a few years after the economy rolls over). At this point, I’m of the opinion that even Trump can not stop (or perhaps even slow significantly) this World Evil Forum / GEBs / TLAs push to destruction of The West and The Common Man. So pretty much “Duck and Cover” financially is all that I see as available to me.
Here’s The Duran take on this:
End Note
On FinViz, I’ve noticed they have blocks for Bitcoin ETFs now. They are fairly large, indicating a lot of money is in them. I’ll likely make some kind of posting of how they are moving relative to other currencies. Why? Not because I think BitCoin is investable. It is, IMHO, for trading not investing. BUT, I expect a LOT of folks with “questionable banking history” desiring to move money out of $US, &Euro; and £ to look at BitCoin as an easy way to move cross borders and into “sanctioned” destinations that might otherwise have their funds blocked.
Essentially, I’m curious to see if the tea leaves show such money flows.
On the lower right side of this chart:
https://finviz.com/map.ashx?t=etf&st=w4you can find tickers for exchange traded funds (ETFs) in Bitcoin. Tickers like FBIT, GBIT, BITO, IBIT and more. That’s one way of watching for price action there.
Just why our Rulers here in the Rule Based Order want to destroy the western financial systems, currencies, and trust in our companies, banks, and laws is a bit beyond my pay grade. It could be sheer stupidity, hubris, or some “clever scheme” to buy it all up once collapsed. Who knows.
About the only thing that is clear is that “This will not end well”, and trying to get off the sinking ship and into financial lifeboats is best done before everyone else is trying to do it at the same time (likely a few months from now IMHO). We have a Global Cabal of Puppets & Clowns as our “leadership” doing very damaging things based on fantasies (such as Global Warming or Ukraine can Win or Russia will fail…) and thinking themselves smart. But who is pulling their strings… WEF? TLAs? GEBs? All of the above?
Sigh. “Intelligence is limited but stupidity knows no bounds. -E.M.Smith”
https://chiefio.wordpress.com/2024/06/17/sanctions-on-china-via-russia-buy-junk-now/
