I would like to add my penny’s worth of wisdom to the thoughtful article of Sr. Hugo Salinas Price entitled WHERE ARE WE TODAY? posted on the website 321 Gold on March 7, 2017.
The phrase ‘nuclear option’ has come to be used by webauthors to mean a hypothetical conspiracy between Russia and China to synchronize the dumping of their huge holdings of U.S. Treasury paper on the markets to the detriment and discomfiture of the United States., thus dislodging the dollar from its position as the world’s only reserve currency.
Of course we must understand that the nuclear option is a double-edged sword: it can hurt also those wielding it. Russia and China could be hurt badly by the precipitously falling price of the Treasury paper.
The same reasoning also underpins the actions of the imbecile policy-makers in the U.S. to allow, incredibly, America’s adversaries to accumulate her debt, thereby exposing her to unprecedented dangers in very dangerous times, on very dangerous waters. It they did it, they have done so in the last-ditch defence of the “esperanto dollar” (esperanto = hoping against hope).
Analysts suggest that Russia’s and China’ gold purchases are in fact designed to hedge against such potential losses.
The, just how credible is the threat of nuclear option? In order to arrive at a realistic appraisal of this threat we must recall that the governments of these countries are imbued with Communist ideology to which the gold standard is anathema. It is true that China ostensibly encourages the Chinese people to hoard gold. However, the gold standard whereby the government promises to convert its debt into cold coin on demand is quite another matter. It is a safe assumption that the governments of Russia and China, while they may pretend to have plans to make their currencies gold convertible, when the chips are down, they would be utterly unwilling to put those plans into practice, certainly domestically, none the less internationally, as well. We must remember that, right after the U.S., Russia and China are the world’s most indebted countries.
I have stated it in my earlier writings that, while the ‘nuclear option’ may have been bandied about, mainly for its value in bullying the United States, there is a much less well recognized nuclear option available to Russia and China which the American policymakers completely missed, but which threaten the U.S. political, economic and military hegemony world-wide more now than any other at any time in history.
Herein also lies the secret of “the accursed Russian and Chinese hunger for gold”. The Russian and the Chinese governments are very conscious of the fact that their nuclear option consists in opening their Mint to the unlimited coinage of gold and silver. If they can pull it off before the U.S. Mint is opened to the unlimited and seigniorage-free coinage of gold and silver, then the race for world hegemony will be settled in their favor, and the U.S. will be effectively deprived of any hope for reversing it in the future.
“He who has the gold makes the rules” – as the old adage holds. This is as true today as it has ever been. Whichever government will open its Mint to the free and unlimited coinage of gold and silver will attract the gold and silver output of all the gold and silver mines of the world to its coffers, excluding all competition. The brain-dead American policymakers are unable to grasp the importance of this fact.
We must realize that the U.S., the Russian and the Chinese governments have one, and only one thing which unites them in their race for world-hegemony: their putative monopoly over the stock of money thanks to the inept Keynesian teaching that governments are free to shift assets from the liability to the asset column of their balance sheet at will under the regime of irredeemable currency.
This monopoly is threatened by the free and unlimited coinage of gold and silver by the public, under the regime of a metallic monetary standard.
Insofar as Russia and China understand this far better than the U.S., they are ahead in the race. Russian and Chinese war-mongers appear amateurish and puerile in comparison with their American counterparts. Russian and Chinese noises to make war sound like faint “me too” , “me too” echoes to American noises to make war at will whenever and wherever they want. The Russians and the Chinese are well aware of this. War is not their turf to compete with the U.S., in spite of their demographic predominance. Obviously, they will attack where the U.S. is most vulnerable. This is the monetary field. Gold and silver are the weapon to pursue their hegemonistic agenda. They will keep up the heat with their threat to open their Mint to the free and unlimited coinage of gold and silver. It could be false-carding, or it could be bluffing of any other type. If the Trump Administration fails to realize that this is where the real challenge is, then the slogan to make America great again will remain empty and will be exposed as such.
The only real Trump card America has, and the only one that Russia and China will respect and fear, is the opening of the U.S. Mint to the free and unlimited coinage of gold and silver as mandated by the American Constitution. Either Trump realizes the truth of this in time, or his presidency will go down in history as the last in a sequence of dismal American presidencies that destroyed a great republic which transformed itself into an ‘Evil Empire’, attempting the construction of a Babelian Tower of Debt in spite of the biblical admonition that God will not tolerate the impudence and conceitedness of the authors and executors of such plans. In their own good time they will get their well-deserved reward, and earn the contempt of the whole world.