I’ve always enjoyed articles from Brandon Smith @ Alt-Market. He is a prolific writer that provides both common sense and statistical information to back up his theories. In part 4 of his series on “One Last Look At the Economy Before it Implodes”, he provides a theory on why and how the International Monetary Fund’s (IMF) Special Drawing Rights (SDR) currency will replace the US dollar as the world’s currency, and how this will plummet the US into a second or even third world country.
Those who understand that our global monetary system is designed to fail know that a backup global reserve currency has to be established. Some say it will be the Chinese Yuan, an American Union Amero, a gold-backed currency, etc. However, I would ask that you give serious consideration to how and why the SDR will rise to the podium so that you can see the writing on the wall before it happens.
Below is a portion of Brandon’s article that I found most relevant. You can read the entire article HERE.
“China has surpassed the U.S. as the world’s largest exporter/importer and has long been far superior to the U.S. in manufacturing capability, making China the most valuable economic partner in the world. According to the IMF, China is now superior to the U.S. in trade standing and is soon to be the largest economy on the planet.
China has recently launched its regional Asian Development Bank, a kind of Asian World Bank. And nearly 50 countries, including European allies to the U.S., have rushed to sign on.
The talk is even growing within mainstream circles that China is about to decouple from the U.S. economy and, along with the BRICS nations, structure a new Asian-centric financial system that will “stick it” to the Western financial elites. This, however, is too simplistic a notion.
We are talking about the REAL economy in this series; and in the real economy, no nation with a central bank actually “breaks” from the New World Order. In fact, all conflicts between the East and West are only serving to further the cause of globalists and Fabian socialists.
China alone does not have the capacity to replace the U.S. as a primary driver for the global economy, nor does the Yuan have the capacity to replace the dollar as a world reserve currency. However, this is not China’s goal. It never has been China’s goal. China’s only purpose in its historic fiscal expansion has been to achieve inclusion in what the IMF calls the “global economic reset.” Part of this reset is the introduction of the IMF global currency basket system, or Special Drawing Rights (SDR), as a kind of centralized control mechanism for all currencies around the world. The IMF and China have continuously called for the SDR basket system to replace the U.S. dollar as the world reserve currency.
I covered this developing scheme in great detail in my article ‘The Economic End Game Explained’.
Despite the hopes of some alternative writers that China will somehow break the chains of the central banking monopoly, every Chinese action since at least 2008 has been in preparation to become a full slave nation under the control of IMF policy. China has now officially submitted its currency (the Yuan) for inclusion as a reserve currency in the SDR basket. China’s central bank has openly called for the IMF to take a dominant role in the management of the world’s currencies through the SDR basket system:
The world economic crisis shows the “inherent vulnerabilities and systemic risks in the existing international monetary system,” Gov. Zhou Xiaochuan said in an essay released Monday by the bank. He recommended creating a currency made up of a basket of global currencies and controlled by the International Monetary Fund and said it would help “to achieve the objective of safeguarding global economic and financial stability.”
The IMF conference on the SDR, which takes place every five years, is set to begin preliminaries in May and finish in October or November. It is widely expected that China’s currency will indeed be included in the SDR this year, that this will adversely affect the dollar’s standing as the world reserve currency, and that the U.S. will have little capacity to stop such a development. That’s because American veto power within the IMF is likely to be removed, due to a lack of approval on funding measures and policy changes put to Congress in 2010.
In numerous articles over the past couple of years I have warned that the destruction of U.S. position within the IMF would be blamed on “political gridlock” over the refusal by Congress to confirm policy changes from 2010, and the brunt of the blame would be placed on “conservatives”. This past week my suspicions were supported by the statements of Larry Summers, a former Treasury Secretary and elitist who was partially responsible for the end of Glass-Steagall and the creation of the derivatives bubble, and the man who claimed “history will overwhelmingly approve QE”. Summers decried the end of the U.S. as the “underwriter of the global economic system”, also stating:
“Largely because of resistance from the right, the US stands alone in the world in failing to approve the International Monetary Fund governance reforms that Washington itself pushed for in 2009. By supplementing IMF resources, this change would have bolstered confidence in the global economy. More important, it would come closer to giving countries such as China and India a share of IMF votes commensurate with their new economic heft…”
“With China’s economic size rivalling America’s and emerging markets accounting for at least half of world output, the global economic architecture needs substantial adjustment. Political pressures from all sides in the US have rendered it increasingly dysfunctional…”
Avid enthusiasm for China’s new regional bank has put the U.S. on the defensive, as supposed allies are joining the chorus calling for China to join the SDR.
This would make the Yuan the first currency not fully convertible to join the SDR basket. Meaning, it is difficult to directly invest in Yuan compared to investing in dollars. But this is exactly what the IMF wants.
The Asian Times put it rather bluntly but honestly:
“Currently, central banks can’t include yuan holdings in their foreign exchange reserves. However, via inclusion in the SDR basket, the currency will effectively enjoy a “back door” where convertibility is concerned. The upshot, according to Citibank, means increased yuan demand from central banks and further integration of the currency into global capital market flows.
Importantly, China has espoused an “internationalisation” of reserve currencies away from U.S. dollar hegemony and dependencies on local economic fluctuations on exchange rates and stability. The yuan inclusion in the basket would be a step towards a more multi-lateral currency world. While full convertibility may still be far away, China’s ability to have a global reserve currency may soon be upon us.”
Yes, that’s right, China’s inclusion in the SDR will HELP the process of marginalization of the dollar and aid in the ascendance of the SDR as a world reserve mechanism. And as China becomes a currency powerhouse in its role as the No. 1 economy in the world, the only way central banks around the planet can benefit or “invest” in the Yuan will be by stockpiling SDRs! Demand for SDRs will be cleverly boosted by natural demand for the Yuan. This is how a global currency structure begins.
The only true beneficiaries of this cycle will be the IMF and those elites who desperately want a totally centralized global economic system.
In the meantime, as the dollar loses its world reserve status, it loses the ONLY pillar of support keeping its value somewhat stable. As the dollar falls, U.S. citizens will be reduced to Second World or Third World economic expectations. Employment and wages will continue to dissolve, while the margins between the “haves” and “have nots” will continue to grow. In the worst-case scenario, total chaos would result followed by an international intervention to “save us” from ourselves. Our currency would likely be permanently pegged to the SDR basket, just as Argentina’s was pegged to our dollar after its collapse. And the IMF would own the U.S. rather than the U.S. owning the IMF, as is the common delusion.