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It amazes me that the government has allowed China to build such a large portfolio in the US.. Stay tuned this may get bad for us..
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Full Story: http://www.prophecynewswatch.com/august08.htm
China Threatens To Trigger US Dollar Crash
The Chinese government has begun a concerted campaign of economic threats against the United States, hinting that it may liquidate its vast holding of US treasuries if Washington imposes trade sanctions to force a yuan revaluation.
Two officials at leading Communist Party bodies have given interviews in recent days warning - for the first time - that Beijing may use its $1.33 trillion (£658bn) of foreign reserves as a political weapon to counter pressure from the US Congress.
Shifts in Chinese policy are often announced through key think tanks and academies.
Described as China's "nuclear option" in the state media, such action could trigger a dollar crash at a time when the US currency is already breaking down through historic support levels.
It would also cause a spike in US bond yields, hammering the US housing market and perhaps tipping the economy into recession. It is estimated that China holds over $900bn in a mix of US bonds.
Xia Bin, finance chief at the Development Research Centre (which has cabinet rank), kicked off what now appears to be government policy with a comment last week that Beijing's foreign reserves should be used as a "bargaining chip" in talks with the US.
"Of course, China doesn't want any undesirable phenomenon in the global financial order," he added.
He Fan, an official at the Chinese Academy of Social Sciences, went even further today, letting it be known that Beijing had the power to set off a dollar collapse if it choose to do so.
"China has accumulated a large sum of US dollars. Such a big sum, of which a considerable portion is in US treasury bonds, contributes a great deal to maintaining the position of the dollar as a reserve currency. Russia, Switzerland, and several other countries have reduced the their dollar holdings.
"China is unlikely to follow suit as long as the yuan's exchange rate is stable against the dollar. The Chinese central bank will be forced to sell dollars once the yuan appreciated dramatically, which might lead to a mass depreciation of the dollar," he told China Daily.
The threats play into the presidential electoral campaign of Hillary Clinton, who has called for restrictive legislation to prevent America being "held hostage to economic decicions being made in Beijing, Shanghai, or Tokyo".
She said foreign control over 44pc of the US national debt had left America acutely vulnerable.
Simon Derrick, a currency strategist at the Bank of New York Mellon, said the comments were a message to the US Senate as Capitol Hill prepares legislation for the Autumn session.
"The words are alarming and unambiguous. This carries a clear political threat and could have very serious consequences at a time when the credit markets are already afraid of contagion from the subprime troubles," he said.
A bill drafted by a group of US senators, and backed by the Senate Finance Committee, calls for trade tariffs against Chinese goods as retaliation for alleged currency manipulation.
The yuan has appreciated 9pc against the dollar over the last two years under a crawling peg but it has failed to halt the rise of China's trade surplus, which reached $26.9bn in June.
Henry Paulson, the US Tresury Secretary, said any such sanctions would undermine American authority and "could trigger a global cycle of protectionist legislation".
Mr Paulson is a China expert from his days as head of Goldman Sachs. He has opted for a softer form of diplomacy, but appeared to win few concession from Beijing on a unscheduled trip to China last week aimed at calming the waters.
‘Rival to Nato’ begins first military exercise
Russian and Chinese troops are joining forces this week in the first military exercises by an international organisation that is regarded in some quarters as a potential rival to Nato.
Thousands of soldiers and 500 combat vehicles will take part in “Peace Mission 2007”, organised by the Shanghai Cooperation Organisation (SCO) in the Chelyabinsk region of Russia. Russian officials have also proposed an alliance between the SCO and a body representing most of the former Soviet republics.
Scores of Russian and Chinese aircraft begin joint exercises tomorrow before a week of military manoeuvres from Thursday that will include Tajikistan, Kyrgyzstan and Kazakhstan. At least 6,500 troops are involved in what is described as an antiterror exercise.
Colonel-General Vladimir Moltenskoi, the deputy commander of Russian ground forces, said: “The exercise will involve practically all SCO members for the first time in its history.”
Staff officers from Uzbekistan, the sixth SCO member, will also attend in what is being regarded as a major extension of the organisation’s capabilities. The SCO was founded as a nonmilitary alliance in 2001 to combat drugs and weapons smuggling as well as terrorism and separatism in the region. It has since developed a role in regional trade and is increasingly regarded by Moscow and Beijing as a counterweight to US global influence.
The secretary-general of the Collective Security Treaty Organisation (CSTO) called last week for joint military exercises with the SCO. Nikolai Bordyuzha said that the body representing Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia, Tajikistan and Uzbekistan should work with the SCO to guarantee security across the region. Mr Bordyuzha has already announced a CSTO plan to create a large military force capable of assisting a member state in the event of an attack. A rapid-reaction force is already based in Central Asia and there are plans for a common air defence system covering most of the former Soviet Union.
Leaders of SCO member states will meet in Bishkek, the Kyrgyz capital, next week for their annual summit. Turkmenistan will also attend for the first time, while Mongolia, Iran, India and Pakistan have observer status.
Igor Ivanov, the head of Russian security, played down concerns in May that the SCO was evolving into a military alliance to counter the expansion of Nato into Asia as part of the War on Terror. But MPs on the Foreign Affairs Select Committee expressed fears last year that the West could be on a collision course in the struggle for energy resources with “an authoritarian bloc opposed to democracy” that was based on an alliance between China and Russia.
A newly assertive Russia, flush with oil and gas revenues, is moving rapidly to increase its military capability amid tensions with the West over missile defence and Nato expansion. Almost £100 billion has been set aside for rearmament over the next eight years.
Valiant Shield exercises simulate possible operation against Iran
The maneuvers beginning Monday, Aug. 6, in waters off Guam include the simultaneous deployment of three carriers and their air and naval strike groups: USS Stennis, USS Nimitz and USS Kitty Hawk, altogether 30 warships, 280 warplanes and 22,000 soldiers and sailors. The exercise is commanded by Adm. Robert Willard, Pacific Fleet chief.
DEBKAfile’s military sources report: This will be America’s last major combined sea-air war game during Bush presidency which ends in Jan. 2009 and last opportunity for drilling large-scale combined units should the president decide on a military operation against Iran.
To indicate that outside eyes were not desired, foreign observers who attended the Pacific exercises last year were not invited this year. US military sources in the region said that invitations to officers of regional nations to watch the drills would have had to include Malaysia, which has close ties with Iran.
According to DEBKA-Net-Weekly’s military sources, the exercises will be held in conditions resembling as closely as possible those in Iran and practice assaults of the kind that may be executed against the Islamic Republic.
When he spoke of the drills, Willard may well have been describing the realities expected to prevail in a real-life offensive against the Islamic Republic.
Valiant Shield, he said, will “include the complexities of operating three aircraft carriers in the same area while at the same time adding in the operations of another component – the fighters, bombers and tankers of the US Air Force.”
He said the exercise will not detract from the Navy’s “real world” missions in the Persian Gulf but help drill the Navy and its crews for that real world.
Valiant Shield’s commander’s words may have been meant to answer the sharp criticism coming from Persian Gulf governments.
“Washington may be sending the USS Enterprise Strike Group to the Persian Gulf. It has not yet arrived. The other two American carriers, Nimitz and Stennis, have gone to take part in an exercise far away in the Pacific.”
“So where does that leave us?” asked a Gulf military official. “Vice President **** Cheney and Robert Gates promised three American air carriers to protect us plus naval, marine and air forces. Now all the carriers are gone.”
Scientists test country's infrastructure in worst-case scenario with "virtual U.S."
The computer screen shows a toxic cloud rolling slowly over buildings, a visualization that permits scientists to record every lethal swirl and eddy and to calculate the toll for a city's residents.
It's a far cry from ``The Sims,'' an addictive computer game that lets users create a virtual universe. As displayed on computers nicknamed ``Coyote'' and ``Thunderbird,'' disaster simulations conducted under a $25 million program run by Sandia and Los Alamos national laboratories are helping the U.S. government predict the impact of chemical or biological attacks, killer hurricanes, or accidents such as the collapse of the bridge on the main highway into Minneapolis.
For years, simulations have helped manage the nuclear- weapons stockpile and conduct war games. Now disaster planners are using them to create a ``virtual U.S.'' in which scientists gird for worst-case scenarios to test the vulnerability of the country's infrastructure, former White House counterterrorism chief Richard Clarke said.
Simulation programs permit scientists to ``imagine a whole series of events and one by one run the tests,'' said Clarke, an early booster of the technique. ``It's as close to reality as you can get.''
Spurred by the twin disasters of Sept. 11 and Hurricane Katrina, officials at the Department of Homeland Security have gotten the message. They're using graphic modeling to predict a disaster's human and economic toll, expose weak spots in defenses and train policy makers in improving their crisis responses.
Flu Pandemic
As early as this month, the Homeland Security Department will release results from the second part of a simulation study of a flu pandemic. The initial phase of the test concluded that a merely adequate vaccine given immediately would be more effective than delayed inoculations with a better drug.
By the end of this year, the lab will complete a study on the Midwest's New Madrid Fault, a break in the earth's crust that some scientists fear could produce an earthquake more devastating than one caused by the San Andreas Fault in California.
Full story: http://www.prophecynewswatch.com/august08.htm
--------------------------------------------------------------------------------
Full Story: http://www.prophecynewswatch.com/august08.htm
China Threatens To Trigger US Dollar Crash
The Chinese government has begun a concerted campaign of economic threats against the United States, hinting that it may liquidate its vast holding of US treasuries if Washington imposes trade sanctions to force a yuan revaluation.
Two officials at leading Communist Party bodies have given interviews in recent days warning - for the first time - that Beijing may use its $1.33 trillion (£658bn) of foreign reserves as a political weapon to counter pressure from the US Congress.
Shifts in Chinese policy are often announced through key think tanks and academies.
Described as China's "nuclear option" in the state media, such action could trigger a dollar crash at a time when the US currency is already breaking down through historic support levels.
It would also cause a spike in US bond yields, hammering the US housing market and perhaps tipping the economy into recession. It is estimated that China holds over $900bn in a mix of US bonds.
Xia Bin, finance chief at the Development Research Centre (which has cabinet rank), kicked off what now appears to be government policy with a comment last week that Beijing's foreign reserves should be used as a "bargaining chip" in talks with the US.
"Of course, China doesn't want any undesirable phenomenon in the global financial order," he added.
He Fan, an official at the Chinese Academy of Social Sciences, went even further today, letting it be known that Beijing had the power to set off a dollar collapse if it choose to do so.
"China has accumulated a large sum of US dollars. Such a big sum, of which a considerable portion is in US treasury bonds, contributes a great deal to maintaining the position of the dollar as a reserve currency. Russia, Switzerland, and several other countries have reduced the their dollar holdings.
"China is unlikely to follow suit as long as the yuan's exchange rate is stable against the dollar. The Chinese central bank will be forced to sell dollars once the yuan appreciated dramatically, which might lead to a mass depreciation of the dollar," he told China Daily.
The threats play into the presidential electoral campaign of Hillary Clinton, who has called for restrictive legislation to prevent America being "held hostage to economic decicions being made in Beijing, Shanghai, or Tokyo".
She said foreign control over 44pc of the US national debt had left America acutely vulnerable.
Simon Derrick, a currency strategist at the Bank of New York Mellon, said the comments were a message to the US Senate as Capitol Hill prepares legislation for the Autumn session.
"The words are alarming and unambiguous. This carries a clear political threat and could have very serious consequences at a time when the credit markets are already afraid of contagion from the subprime troubles," he said.
A bill drafted by a group of US senators, and backed by the Senate Finance Committee, calls for trade tariffs against Chinese goods as retaliation for alleged currency manipulation.
The yuan has appreciated 9pc against the dollar over the last two years under a crawling peg but it has failed to halt the rise of China's trade surplus, which reached $26.9bn in June.
Henry Paulson, the US Tresury Secretary, said any such sanctions would undermine American authority and "could trigger a global cycle of protectionist legislation".
Mr Paulson is a China expert from his days as head of Goldman Sachs. He has opted for a softer form of diplomacy, but appeared to win few concession from Beijing on a unscheduled trip to China last week aimed at calming the waters.
‘Rival to Nato’ begins first military exercise
Russian and Chinese troops are joining forces this week in the first military exercises by an international organisation that is regarded in some quarters as a potential rival to Nato.
Thousands of soldiers and 500 combat vehicles will take part in “Peace Mission 2007”, organised by the Shanghai Cooperation Organisation (SCO) in the Chelyabinsk region of Russia. Russian officials have also proposed an alliance between the SCO and a body representing most of the former Soviet republics.
Scores of Russian and Chinese aircraft begin joint exercises tomorrow before a week of military manoeuvres from Thursday that will include Tajikistan, Kyrgyzstan and Kazakhstan. At least 6,500 troops are involved in what is described as an antiterror exercise.
Colonel-General Vladimir Moltenskoi, the deputy commander of Russian ground forces, said: “The exercise will involve practically all SCO members for the first time in its history.”
Staff officers from Uzbekistan, the sixth SCO member, will also attend in what is being regarded as a major extension of the organisation’s capabilities. The SCO was founded as a nonmilitary alliance in 2001 to combat drugs and weapons smuggling as well as terrorism and separatism in the region. It has since developed a role in regional trade and is increasingly regarded by Moscow and Beijing as a counterweight to US global influence.
The secretary-general of the Collective Security Treaty Organisation (CSTO) called last week for joint military exercises with the SCO. Nikolai Bordyuzha said that the body representing Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia, Tajikistan and Uzbekistan should work with the SCO to guarantee security across the region. Mr Bordyuzha has already announced a CSTO plan to create a large military force capable of assisting a member state in the event of an attack. A rapid-reaction force is already based in Central Asia and there are plans for a common air defence system covering most of the former Soviet Union.
Leaders of SCO member states will meet in Bishkek, the Kyrgyz capital, next week for their annual summit. Turkmenistan will also attend for the first time, while Mongolia, Iran, India and Pakistan have observer status.
Igor Ivanov, the head of Russian security, played down concerns in May that the SCO was evolving into a military alliance to counter the expansion of Nato into Asia as part of the War on Terror. But MPs on the Foreign Affairs Select Committee expressed fears last year that the West could be on a collision course in the struggle for energy resources with “an authoritarian bloc opposed to democracy” that was based on an alliance between China and Russia.
A newly assertive Russia, flush with oil and gas revenues, is moving rapidly to increase its military capability amid tensions with the West over missile defence and Nato expansion. Almost £100 billion has been set aside for rearmament over the next eight years.
Valiant Shield exercises simulate possible operation against Iran
The maneuvers beginning Monday, Aug. 6, in waters off Guam include the simultaneous deployment of three carriers and their air and naval strike groups: USS Stennis, USS Nimitz and USS Kitty Hawk, altogether 30 warships, 280 warplanes and 22,000 soldiers and sailors. The exercise is commanded by Adm. Robert Willard, Pacific Fleet chief.
DEBKAfile’s military sources report: This will be America’s last major combined sea-air war game during Bush presidency which ends in Jan. 2009 and last opportunity for drilling large-scale combined units should the president decide on a military operation against Iran.
To indicate that outside eyes were not desired, foreign observers who attended the Pacific exercises last year were not invited this year. US military sources in the region said that invitations to officers of regional nations to watch the drills would have had to include Malaysia, which has close ties with Iran.
According to DEBKA-Net-Weekly’s military sources, the exercises will be held in conditions resembling as closely as possible those in Iran and practice assaults of the kind that may be executed against the Islamic Republic.
When he spoke of the drills, Willard may well have been describing the realities expected to prevail in a real-life offensive against the Islamic Republic.
Valiant Shield, he said, will “include the complexities of operating three aircraft carriers in the same area while at the same time adding in the operations of another component – the fighters, bombers and tankers of the US Air Force.”
He said the exercise will not detract from the Navy’s “real world” missions in the Persian Gulf but help drill the Navy and its crews for that real world.
Valiant Shield’s commander’s words may have been meant to answer the sharp criticism coming from Persian Gulf governments.
“Washington may be sending the USS Enterprise Strike Group to the Persian Gulf. It has not yet arrived. The other two American carriers, Nimitz and Stennis, have gone to take part in an exercise far away in the Pacific.”
“So where does that leave us?” asked a Gulf military official. “Vice President **** Cheney and Robert Gates promised three American air carriers to protect us plus naval, marine and air forces. Now all the carriers are gone.”
Scientists test country's infrastructure in worst-case scenario with "virtual U.S."
The computer screen shows a toxic cloud rolling slowly over buildings, a visualization that permits scientists to record every lethal swirl and eddy and to calculate the toll for a city's residents.
It's a far cry from ``The Sims,'' an addictive computer game that lets users create a virtual universe. As displayed on computers nicknamed ``Coyote'' and ``Thunderbird,'' disaster simulations conducted under a $25 million program run by Sandia and Los Alamos national laboratories are helping the U.S. government predict the impact of chemical or biological attacks, killer hurricanes, or accidents such as the collapse of the bridge on the main highway into Minneapolis.
For years, simulations have helped manage the nuclear- weapons stockpile and conduct war games. Now disaster planners are using them to create a ``virtual U.S.'' in which scientists gird for worst-case scenarios to test the vulnerability of the country's infrastructure, former White House counterterrorism chief Richard Clarke said.
Simulation programs permit scientists to ``imagine a whole series of events and one by one run the tests,'' said Clarke, an early booster of the technique. ``It's as close to reality as you can get.''
Spurred by the twin disasters of Sept. 11 and Hurricane Katrina, officials at the Department of Homeland Security have gotten the message. They're using graphic modeling to predict a disaster's human and economic toll, expose weak spots in defenses and train policy makers in improving their crisis responses.
Flu Pandemic
As early as this month, the Homeland Security Department will release results from the second part of a simulation study of a flu pandemic. The initial phase of the test concluded that a merely adequate vaccine given immediately would be more effective than delayed inoculations with a better drug.
By the end of this year, the lab will complete a study on the Midwest's New Madrid Fault, a break in the earth's crust that some scientists fear could produce an earthquake more devastating than one caused by the San Andreas Fault in California.
Full story: http://www.prophecynewswatch.com/august08.htm
