PPERKINSARTThe U.S. government has made all the wrong moves.  The temporary economic boon coupled with weak employment numbers should be the first signal to Americans that something is seriously wrong.  Meanwhile, the Federal Reserve is still printing money despite dramatic improvements in the market.  Why?  The answer is simple.  It cannot stop now.  Ben Bernanke’s currency manipulation has improved the appearance of the stock market by weakening the dollar.  Wall Street is making record profits, but the value of American money is slipping into oblivion.

This central planning method is not new.  These were the same tactics tried in Germany’s Weimar Republic from 1919 to 1923.  That horror story ended with the price of a loaf of bread rising from 1 mark to 100 billion marks.  Since we have three more years to try out the most failed system in U.S. history, you might want to trade in your wallet for a wheelbarrow.  Thank you, Mr. President.

While the Federal Reserve, President Obama, and Rachel Maddow remain clueless on what is happening to the U.S. economy, China seems fully aware. The unending episodes of quantitative easing (the practice of printing money that can cause short-term stimulus but weakens the dollar in the long run) combined with massive amounts of debt have destroyed the credibility of the dollar and the world is taking notice.

In an attempt to shield itself from the risks of trading with the U.S. dollar, the Chinese government is now trading in its own currency.  Last week, an unprecedented 30 billion dollar trade deal with Brazil signified the world’s growing insecurity over the dollar.  China and Brazil are members of BRICS (a partnership of nations including Brazil, Russian, India, China and South Africa).  The BRICS nations announced their own development bank this week, another attempt to circumvent western influence from the World Bank.

The U.S. government is weakening the dollar with its policies while completely ignoring these developments and another phenomenon overtaking the markets, the China gold rush.  Even Bernanke seems unconcerned that China is hoping to move to a gold backed currency soon.  He sees the gold standard as an “awful waste of resources.”

This is definitely not the Chinese attitude.  Former General Secretary of the Communist Party of China, Hu Jintao, called the current international currency system a “product of the past.”  China’s game is not all talk and Americans should be concerned.  Chinese foreign currency reserves have shot up 700% since 2004 and currently stand large enough to buy all of the world’s gold bullion…twice.

While gold was down this week, the Chinese and Russian buying frenzy continued.  It is expected that China will reveal by 2014 that they have acquired more than 4000 tons of gold in just the past few years.  This will see China at the same gold-to-GDP ratio as the United States and potentially triple gold prices by 2015.

If the weakening dollar doesn’t concern you, the military situation might.  While the U.S. is neglecting its military advancements, China is quickly catching up.  The old argument was, China has the numbers, but they don’t have the technology to be a dominant force against the U.S.  This is far less true than it was a few decades ago.  Defense Secretary Robert Gates recently admitted China is modernizing its military at an alarming pace:

 

“They clearly have the potential to put some of our capabilities at risk. And we have to pay attention to them, we have to respond appropriately with our own programs,” Gates said on a 2011 visit to Beijing.  “My hope is that, through the strategic dialogue that I’m talking about, that maybe the need for some of these capabilities is reduced.”

 

Essentially, Gates is relying on a strategy of friendship with the Chinese government in hopes that they will continue to let us dominate the western pacific.  This continues a foreign policy methodology of complete ignorance.  The new general secretary, Xi Jinping, has begun to promote a message called, “the China Dream” which advocates Chinese military superiority over the United States.  This does not sound like a message of friendship, it sounds adversarial.

The weakening of the dollar by the Federal Reserve, the whimsical hippie foreign policy of the White House, and the degradation of our culture at the hands of the progressive movement, all add up to one question: Is this a post U.S. world?  Time will tell, but unfortunately we won’t have to wait long to find the answer.