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New old financial crisis & China's peace plan
Since Silicon Valley Bank, Silvergate Corporation, and Signature Bank all toppled within a week in the U.S., and now First Republic Bank has also run into trouble, there are increasing signs that the next big financial crisis, which was only postponed in 2019 by tons of freshly printed central bank money, could now erupt with force. $9 trillion has been injected into the "U.S. market" since 2019.
New old financial crisis
by Klaus Wagener
[This article posted on 3/24/2023 is translated from the German on the Internet, https://www.unsere-zeit.de/neue-alte-finanzkrise-4778421/.]
1206 Silicon Valley Bank Temple Arizona - New old financial crisis - banking crisis, Credit Suisse, First Republic Bank, Signature Bank, Silicon Valley Bank, Silvergate Corporation - International
Silicon Valley Bank is not the only bank to stumble in the U.S. in recent weeks, either.
The US banking crisis has reached Europe. The old but less venerable Credit Suisse (CS), founded in 1856 as Schweizerische Kreditanstalt, then anglicized "Credit Suisse Group" in 1997, is in danger of toppling unless it is rescued as "systemically important."
CS still had total assets of 787.2 billion Swiss francs in 2019. However, the bank's share price had more than halved in the crisis since 2008, from 54.21 euros in 2007 to around 20 euros, and has now fallen to a meager 2.04 euros (as of March 17). CS securities are not far from being classified as junk bonds.
Since Silicon Valley Bank, Silvergate Corporation, and Signature Bank all toppled within a week in the U.S., and now First Republic Bank has also run into trouble, there are increasing signs that the next big financial crisis, which was only postponed in 2019 by tons of freshly printed central bank money, could now erupt with force. Some $9 trillion has been injected into the "U.S. market" since 2019. The rating agency Moody's has rated the outlook of the entire U.S. banking sector as "negative." The Swiss National Bank has announced its intention to bail out CS with a whopping 50 billion Swiss francs.
The neoliberal financial and banking system of the West, and especially that of the USA, fell into a deep structural crisis at the beginning of the century. The exclusive focus on the profit of the super-rich has so far produced three major outbreaks of crisis. The dotcom crisis of 2000, the financial crisis of 2008 ff. and the current crisis of 2019/2023. These crises are not simply a repetition of the previous crisis in each case, but they reach a much higher level because the bubble, the crisis level or the disproportion created by the central bank "bailout" becomes massively larger each time.
Between the two crises of 2008 onwards and 2023 onwards, there are 13 years of quantitative easing (QE), zero interest rate policies and an unprecedented monetary and debt explosion. This gigantic fattening of the rich had driven stock prices and thus the speculative fortunes of finance capital to astronomical heights - at the expense of gutted and exported industrial capital. Then last year, however, the U.S. Federal Reserve (Fed) and, in its wake, the ECB ended the party and began to creep interest rates to normal levels. Real inflation had easily exceeded the 10 percent mark. Fed Chairman Jerome Powell's self-imposed task is now to prevent wages from rising to similar levels.
A similar task had already been set by then Fed Chairman Paul Volcker when he raised interest rates to as high as 20 percent in 1980. However, before the Volcker shock, the U.S. debt-to-GDP ratio was 31.6 percent. Today, that figure is 125 percent/GDP ($31.6 trillion).
A significant change in the level of interest rates now has serious economic consequences. The interest rate on a 30-year U.S. mortgage in November 2022 was a whopping 6.95 percent. If U.S. credit only reached that level, it would mean an interest burden of $6.57 trillion for U.S. society as a whole, or about 30 percent of total U.S. economic output. This is hardly likely to be representable. The neoliberal financial system has been maneuvered by its protagonists into a dead end in which the only choice is between plague and cholera.
In the crisis of 2008 onwards, there was fraud on a very large scale, covered by the Bush warriors. There were the subprime or NINJA loans ("No Income, No Job, No Assets"), the multiple repackaging of the credit junk, the triple-A ratings, the hawking of all the junk and so on. The current crisis shows that it can be done without. The current imbalances are not so much a consequence of criminal machinations, but rather the result of the gigantic securities and debt inflation that has been pursued by the major central banks for more than a decade and that is now preventing a return to "normality."
The basic problem of neoliberally de-limited financial capitalism is that the growth curve of the real economy cannot keep up at all with the rapid growth of the financial economy, of debt as well as of enrichment. The periodic crash is programmed, so to speak. This time, however, it coincides with the wars of the U.S. empire for the preservation of its global domination and currency privilege. The West wanted to ruin Russia, now the banks are falling over here. What will happen if China is messed with? Moody's rating is not so unfounded.
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
China's peace plan
U.S. fears being cornered by Chinese proposal
While German media claim that the Chinese peace proposal for Ukraine is not taken seriously internationally, the truth is quite different.
[This article posted on 3/24/2023 is translated from the German on the Internet, https://www.anti-spiegel.ru/2023/usa-befuerchten-durch-den-chinesischen-vorschlag-in-die-enge-getrieben-zu-werden/?doing_wp_cron=1679738789.2438399791717529296875.]
German media like to call the peace plan presented by China an "alleged" peace plan, and they have continuously claimed during the Chinese president's Moscow visit that the plan is not to be taken seriously and is "internationally controversial." This formulation is only partly correct, because the fact that the plan is internationally controversial is mainly due to the fact that the West rejects it. However, the West is quite alone in this internationally.
The Chinese peace plan is reasonable because it also takes into account the past history of the conflict, which must be resolved if there is to be a negotiated peace that ends the bloodshed. And as we know, the West has played a major role in that back story by ignoring Russia's security interests and arming Ukraine and pushing its NATO accession. That was the main reason for the escalation of the war a year ago.
There are legally valid agreements between the West and Russia, which state that no state may impose its security interests at the expense of the security interests of another state. It is precisely this agreement that the West violated when it pushed for Ukraine's NATO accession. China's peace plan envisions, among other things, that this provision will also be established worldwide, which the U.S.-led West does not like at all.
German media consumers, however, know nothing about this because the German media keep quiet about this and other details and background of the Chinese peace plan. But in the rest of the world they know all this very well, which is why China's peace plan is not criticized outside the West, but welcomed as quite reasonable.
They know this in the U.S., too, as Bloomberg has now reported. According to Bloomberg, the U.S. government is very worried about the Chinese peace plan because the U.S. rejection of the plan openly shows the rest of the world that the U.S. is not interested in peace in Ukraine. I have translated the Bloomberg article so that German readers can make up their own minds.
Start of translation:
U.S. fears war-weary world may accept China's peace offer for Ukraine
U.S. on sidelines as Sino-Russian "brotherly festival" solidifies ties
Some uncomfortable realities of Xi's visit with Putin in Moscow
Xi Jinping's meeting with Vladimir Putin in Moscow put the Biden administration in an uncomfortable position: standing on the sidelines as their two adversaries discussed a peace proposal for Ukraine that the United States found unacceptable.
U.S. officials have publicly expressed strong skepticism about the Chinese idea, claiming that calling for a cease-fire would reward Moscow's invasion by cementing its territorial gains. Secretly, however, the meetings and the proposal have created a sense of unease within the government, which in turn has led to questions about the overall U.S. attitude toward the two countries.
According to one administration official, who asked not to be named because he is discussing internal deliberations, the U.S. fears being cornered by the Chinese proposal. Regardless of U.S. reservations, if it rejects the proposal outright, China could give the impression to other nations tired of the war - and the economic damage it is doing - that Washington is not interested in peace.
If the U.S. rejects the agreement, "China is likely to increasingly spread the message that the U.S. is against a cease-fire, that the U.S. is against ending the war," said Bonny Lin, a fellow at the Center for Strategic and International Studies who formerly served in the Pentagon. "There will be many ways China will try to interpret the results of the China-Russia meeting in a way that portrays the U.S. in a negative light."
The debate over China's version of a peace plan is just one of the many unpleasant aspects of Xi's three-day visit to Moscow this week, during which the Chinese leader was warmly welcomed by Putin. The two countries promised to deepen their partnership even further.
The Biden administration has tried to keep China on the sidelines since the invasion of Ukraine began, but the opposite seems to have happened. As Xi and Putin grow closer, China is finding a receptive audience for its broader diplomatic efforts around the globe.
At a Senate hearing Wednesday, Sen. Jeff Merkley asked Secretary of State Antony Blinken to comment on what the Oregon Democrat called a "three-day brotherfest with Putin and Xi celebrating their authoritarian power." Blinken acknowledged that it was a continuation of the two nations' pledge just before the war to maintain a "partnership without borders."
"It's not a surprise - both countries have very different world views than we do," Blinken said. "They could find common cause in opposing the worldview that we and so many other countries around the world are trying to defend and advance."
Blinken did not mention all the countries that have refused to take sides despite U.S. urging.
China has defied U.S. sanctions because of its companies' partnership with Russia, bought oil from the Iranian regime despite Western warnings, and helped bring about a diplomatic détente between Saudi Arabia and Iran. Major global economic powers such as India and Brazil refuse to choose between China and the West, saying they do not want a new Cold War.
And a week ago, Honduras began abandoning diplomatic relations with Taiwan in favor of economic ties with China.
The move was "a sign of my determination to fulfill the government plan and freely expand borders in harmony with the nations of the world," President Xiomara Castro said in a tweet.
Deteriorating ties
All of this comes at a time when U.S.-China relations, which began to crumble with former President Donald Trump's trade war, continue to deteriorate. That was underscored by the furor over the alleged Chinese spy balloon, which sparked a national outcry in the U.S. and angry recriminations between Washington and Beijing.
The episode scuttled an attempt to stabilize relations late last year with a face-to-face summit between President Joe Biden and Xi in Indonesia. That led to a tense meeting between Secretary of State Antony Blinken and top Chinese diplomat Wang Yi in Munich, and Xi later warned of "comprehensive containment and repression by Western countries led by the United States."
U.S. officials argue that their sharp words to Beijing are having an effect. They say that public U.S. warnings that China could provide lethal aid to Russia have made the Xi government think twice about the idea. The U.S. continues to supply Ukraine with weapons - it announced $325 million worth of new munitions this week - in coordination with European countries that are themselves drawing up new supply plans.
The Biden administration has tried to get China to confront the Ukraine crisis on U.S. terms, but "Xi is now interfering on his terms," said Christopher K. Johnson, president of China Strategies Group, a political risk consulting firm. "And I think that's likely to cause some confusion within the administration."
With Washington constantly taking a hard line on China, some analysts believe China may have effectively given up on improving relations with the U.S. anytime soon.
The less China sees the possibility of working with the U.S., "the more likely it is to pursue these other avenues and options," said Melanie Sisson, a foreign policy fellow at the Brookings Institution. "And in many ways and places, that's going to mean they're going to try to fray U.S. relations with other countries."
End of translation
In my new book ""Putin's Plan - With Europe and the U.S. the World Does Not End - How the Western System Is Just Destroying Itself "" I address the question of what the final battle of systems - which we are experiencing right now - is really about. We are witnessing nothing less than the battle of two systems in which Vladimir Putin is offering the world an alternative to neoliberal globalism. Have citizens in the West been asked if they want all this, if they want to give up their prosperity and freedoms in favor of neoliberal globalism?New old financial crisis
by Klaus Wagener
[This article posted on 3/24/2023 is translated from the German on the Internet, https://www.unsere-zeit.de/neue-alte-finanzkrise-4778421/.]
1206 Silicon Valley Bank Temple Arizona - New old financial crisis - banking crisis, Credit Suisse, First Republic Bank, Signature Bank, Silicon Valley Bank, Silvergate Corporation - International
Silicon Valley Bank is not the only bank to stumble in the U.S. in recent weeks, either. (Photo: Tony Webster / flickr / CC BY 2.0)
The US banking crisis has reached Europe. The old but less venerable Credit Suisse (CS), founded in 1856 as Schweizerische Kreditanstalt, then anglicized "Credit Suisse Group" in 1997, is in danger of toppling unless it is rescued as "systemically important."
CS still had total assets of 787.2 billion Swiss francs in 2019. However, the bank's share price had more than halved in the crisis since 2008, from 54.21 euros in 2007 to around 20 euros, and has now fallen to a meager 2.04 euros (as of March 17). CS securities are not far from being classified as junk bonds.
Since Silicon Valley Bank, Silvergate Corporation, and Signature Bank all toppled within a week in the U.S., and now First Republic Bank has also run into trouble, there are increasing signs that the next big financial crisis, which was only postponed in 2019 by tons of freshly printed central bank money, could now erupt with force. Some $9 trillion has been injected into the "U.S. market" since 2019. The rating agency Moody's has rated the outlook of the entire U.S. banking sector as "negative." The Swiss National Bank has announced its intention to bail out CS with a whopping 50 billion Swiss francs.
The neoliberal financial and banking system of the West, and especially that of the USA, fell into a deep structural crisis at the beginning of the century. The exclusive focus on the profit of the super-rich has so far produced three major outbreaks of crisis. The dotcom crisis of 2000, the financial crisis of 2008 ff. and the current crisis of 2019/2023. These crises are not simply a repetition of the previous crisis in each case, but they reach a much higher level because the bubble, the crisis level or the disproportion created by the central bank "bailout" becomes massively larger each time.
Between the two crises of 2008 onwards and 2023 onwards, there are 13 years of quantitative easing (QE), zero interest rate policies and an unprecedented monetary and debt explosion. This gigantic fattening of the rich had driven stock prices and thus the speculative fortunes of finance capital to astronomical heights - at the expense of gutted and exported industrial capital. Then last year, however, the U.S. Federal Reserve (Fed) and, in its wake, the ECB ended the party and began to creep interest rates to normal levels. Real inflation had easily exceeded the 10 percent mark. Fed Chairman Jerome Powell's self-imposed task is now to prevent wages from rising to similar levels.
A similar task had already been set by then Fed Chairman Paul Volcker when he raised interest rates to as high as 20 percent in 1980. However, before the Volcker shock, the U.S. debt-to-GDP ratio was 31.6 percent. Today, that figure is 125 percent/GDP ($31.6 trillion).
A significant change in the level of interest rates now has serious economic consequences. The interest rate on a 30-year U.S. mortgage in November 2022 was a whopping 6.95 percent. If U.S. credit only reached that level, it would mean an interest burden of $6.57 trillion for U.S. society as a whole, or about 30 percent of total U.S. economic output. This is hardly likely to be representable. The neoliberal financial system has been maneuvered by its protagonists into a dead end in which the only choice is between plague and cholera.
In the crisis of 2008 onwards, there was fraud on a very large scale, covered by the Bush warriors. There were the subprime or NINJA loans ("No Income, No Job, No Assets"), the multiple repackaging of the credit junk, the triple-A ratings, the hawking of all the junk and so on. The current crisis shows that it can be done without. The current imbalances are not so much a consequence of criminal machinations, but rather the result of the gigantic securities and debt inflation that has been pursued by the major central banks for more than a decade and that is now preventing a return to "normality."
The basic problem of neoliberally de-limited financial capitalism is that the growth curve of the real economy cannot keep up at all with the rapid growth of the financial economy, of debt as well as of enrichment. The periodic crash is programmed, so to speak. This time, however, it coincides with the wars of the U.S. empire for the preservation of its global domination and currency privilege. The West wanted to ruin Russia, now the banks are falling over here. What will happen if China is messed with? Moody's rating is not so unfounded.
___________________________________________________________________
China's peace plan
U.S. fears being cornered by Chinese proposal
While German media claim that the Chinese peace proposal for Ukraine is not taken seriously internationally, the truth is quite different.
[This article posted on 3/24/2023 is translated from the German on the Internet, https://www.anti-spiegel.ru/2023/usa-befuerchten-durch-den-chinesischen-vorschlag-in-die-enge-getrieben-zu-werden/?doing_wp_cron=1679738789.2438399791717529296875.]
German media like to call the peace plan presented by China an "alleged" peace plan, and they have continuously claimed during the Chinese president's Moscow visit that the plan is not to be taken seriously and is "internationally controversial." This formulation is only partly correct, because the fact that the plan is internationally controversial is mainly due to the fact that the West rejects it. However, the West is quite alone in this internationally.
The Chinese peace plan is reasonable because it also takes into account the past history of the conflict, which must be resolved if there is to be a negotiated peace that ends the bloodshed. And as we know, the West has played a major role in that back story by ignoring Russia's security interests and arming Ukraine and pushing its NATO accession. That was the main reason for the escalation of the war a year ago.
There are legally valid agreements between the West and Russia, which state that no state may impose its security interests at the expense of the security interests of another state. It is precisely this agreement that the West violated when it pushed for Ukraine's NATO accession. China's peace plan envisions, among other things, that this provision will also be established worldwide, which the U.S.-led West does not like at all.
German media consumers, however, know nothing about this because the German media keep quiet about this and other details and background of the Chinese peace plan. But in the rest of the world they know all this very well, which is why China's peace plan is not criticized outside the West, but welcomed as quite reasonable.
They know this in the U.S., too, as Bloomberg has now reported. According to Bloomberg, the U.S. government is very worried about the Chinese peace plan because the U.S. rejection of the plan openly shows the rest of the world that the U.S. is not interested in peace in Ukraine. I have translated the Bloomberg article so that German readers can make up their own minds.
Start of translation:
U.S. fears war-weary world may accept China's peace offer for Ukraine
U.S. on sidelines as Sino-Russian "brotherly festival" solidifies ties
Some uncomfortable realities of Xi's visit with Putin in Moscow
Xi Jinping's meeting with Vladimir Putin in Moscow put the Biden administration in an uncomfortable position: standing on the sidelines as their two adversaries discussed a peace proposal for Ukraine that the United States found unacceptable.
U.S. officials have publicly expressed strong skepticism about the Chinese idea, claiming that calling for a cease-fire would reward Moscow's invasion by cementing its territorial gains. Secretly, however, the meetings and the proposal have created a sense of unease within the government, which in turn has led to questions about the overall U.S. attitude toward the two countries.
According to one administration official, who asked not to be named because he is discussing internal deliberations, the U.S. fears being cornered by the Chinese proposal. Regardless of U.S. reservations, if it rejects the proposal outright, China could give the impression to other nations tired of the war - and the economic damage it is doing - that Washington is not interested in peace.
If the U.S. rejects the agreement, "China is likely to increasingly spread the message that the U.S. is against a cease-fire, that the U.S. is against ending the war," said Bonny Lin, a fellow at the Center for Strategic and International Studies who formerly served in the Pentagon. "There will be many ways China will try to interpret the results of the China-Russia meeting in a way that portrays the U.S. in a negative light."
The debate over China's version of a peace plan is just one of the many unpleasant aspects of Xi's three-day visit to Moscow this week, during which the Chinese leader was warmly welcomed by Putin. The two countries promised to deepen their partnership even further.
The Biden administration has tried to keep China on the sidelines since the invasion of Ukraine began, but the opposite seems to have happened. As Xi and Putin grow closer, China is finding a receptive audience for its broader diplomatic efforts around the globe.
At a Senate hearing Wednesday, Sen. Jeff Merkley asked Secretary of State Antony Blinken to comment on what the Oregon Democrat called a "three-day brotherfest with Putin and Xi celebrating their authoritarian power." Blinken acknowledged that it was a continuation of the two nations' pledge just before the war to maintain a "partnership without borders."
"It's not a surprise - both countries have very different world views than we do," Blinken said. "They could find common cause in opposing the worldview that we and so many other countries around the world are trying to defend and advance."
Blinken did not mention all the countries that have refused to take sides despite U.S. urging.
China has defied U.S. sanctions because of its companies' partnership with Russia, bought oil from the Iranian regime despite Western warnings, and helped bring about a diplomatic détente between Saudi Arabia and Iran. Major global economic powers such as India and Brazil refuse to choose between China and the West, saying they do not want a new Cold War.
And a week ago, Honduras began abandoning diplomatic relations with Taiwan in favor of economic ties with China.
The move was "a sign of my determination to fulfill the government plan and freely expand borders in harmony with the nations of the world," President Xiomara Castro said in a tweet.
Deteriorating ties
All of this comes at a time when U.S.-China relations, which began to crumble with former President Donald Trump's trade war, continue to deteriorate. That was underscored by the furor over the alleged Chinese spy balloon, which sparked a national outcry in the U.S. and angry recriminations between Washington and Beijing.
The episode scuttled an attempt to stabilize relations late last year with a face-to-face summit between President Joe Biden and Xi in Indonesia. That led to a tense meeting between Secretary of State Antony Blinken and top Chinese diplomat Wang Yi in Munich, and Xi later warned of "comprehensive containment and repression by Western countries led by the United States."
U.S. officials argue that their sharp words to Beijing are having an effect. They say that public U.S. warnings that China could provide lethal aid to Russia have made the Xi government think twice about the idea. The U.S. continues to supply Ukraine with weapons - it announced $325 million worth of new munitions this week - in coordination with European countries that are themselves drawing up new supply plans.
The Biden administration has tried to get China to confront the Ukraine crisis on U.S. terms, but "Xi is now interfering on his terms," said Christopher K. Johnson, president of China Strategies Group, a political risk consulting firm. "And I think that's likely to cause some confusion within the administration."
With Washington constantly taking a hard line on China, some analysts believe China may have effectively given up on improving relations with the U.S. anytime soon.
The less China sees the possibility of working with the U.S., "the more likely it is to pursue these other avenues and options," said Melanie Sisson, a foreign policy fellow at the Brookings Institution. "And in many ways and places, that's going to mean they're going to try to fray U.S. relations with other countries."
End of translation
In my new book ""Putin's Plan - With Europe and the U.S. the World Does Not End - How the Western System Is Just Destroying Itself "" I address the question of what the final battle of systems - which we are experiencing right now - is really about. We are witnessing nothing less than the battle of two systems in which Vladimir Putin is offering the world an alternative to neoliberal globalism. Have citizens in the West been asked if they want all this, if they want to give up their prosperity and freedoms in favor of neoliberal globalism?
by Klaus Wagener
[This article posted on 3/24/2023 is translated from the German on the Internet, https://www.unsere-zeit.de/neue-alte-finanzkrise-4778421/.]
1206 Silicon Valley Bank Temple Arizona - New old financial crisis - banking crisis, Credit Suisse, First Republic Bank, Signature Bank, Silicon Valley Bank, Silvergate Corporation - International
Silicon Valley Bank is not the only bank to stumble in the U.S. in recent weeks, either.
The US banking crisis has reached Europe. The old but less venerable Credit Suisse (CS), founded in 1856 as Schweizerische Kreditanstalt, then anglicized "Credit Suisse Group" in 1997, is in danger of toppling unless it is rescued as "systemically important."
CS still had total assets of 787.2 billion Swiss francs in 2019. However, the bank's share price had more than halved in the crisis since 2008, from 54.21 euros in 2007 to around 20 euros, and has now fallen to a meager 2.04 euros (as of March 17). CS securities are not far from being classified as junk bonds.
Since Silicon Valley Bank, Silvergate Corporation, and Signature Bank all toppled within a week in the U.S., and now First Republic Bank has also run into trouble, there are increasing signs that the next big financial crisis, which was only postponed in 2019 by tons of freshly printed central bank money, could now erupt with force. Some $9 trillion has been injected into the "U.S. market" since 2019. The rating agency Moody's has rated the outlook of the entire U.S. banking sector as "negative." The Swiss National Bank has announced its intention to bail out CS with a whopping 50 billion Swiss francs.
The neoliberal financial and banking system of the West, and especially that of the USA, fell into a deep structural crisis at the beginning of the century. The exclusive focus on the profit of the super-rich has so far produced three major outbreaks of crisis. The dotcom crisis of 2000, the financial crisis of 2008 ff. and the current crisis of 2019/2023. These crises are not simply a repetition of the previous crisis in each case, but they reach a much higher level because the bubble, the crisis level or the disproportion created by the central bank "bailout" becomes massively larger each time.
Between the two crises of 2008 onwards and 2023 onwards, there are 13 years of quantitative easing (QE), zero interest rate policies and an unprecedented monetary and debt explosion. This gigantic fattening of the rich had driven stock prices and thus the speculative fortunes of finance capital to astronomical heights - at the expense of gutted and exported industrial capital. Then last year, however, the U.S. Federal Reserve (Fed) and, in its wake, the ECB ended the party and began to creep interest rates to normal levels. Real inflation had easily exceeded the 10 percent mark. Fed Chairman Jerome Powell's self-imposed task is now to prevent wages from rising to similar levels.
A similar task had already been set by then Fed Chairman Paul Volcker when he raised interest rates to as high as 20 percent in 1980. However, before the Volcker shock, the U.S. debt-to-GDP ratio was 31.6 percent. Today, that figure is 125 percent/GDP ($31.6 trillion).
A significant change in the level of interest rates now has serious economic consequences. The interest rate on a 30-year U.S. mortgage in November 2022 was a whopping 6.95 percent. If U.S. credit only reached that level, it would mean an interest burden of $6.57 trillion for U.S. society as a whole, or about 30 percent of total U.S. economic output. This is hardly likely to be representable. The neoliberal financial system has been maneuvered by its protagonists into a dead end in which the only choice is between plague and cholera.
In the crisis of 2008 onwards, there was fraud on a very large scale, covered by the Bush warriors. There were the subprime or NINJA loans ("No Income, No Job, No Assets"), the multiple repackaging of the credit junk, the triple-A ratings, the hawking of all the junk and so on. The current crisis shows that it can be done without. The current imbalances are not so much a consequence of criminal machinations, but rather the result of the gigantic securities and debt inflation that has been pursued by the major central banks for more than a decade and that is now preventing a return to "normality."
The basic problem of neoliberally de-limited financial capitalism is that the growth curve of the real economy cannot keep up at all with the rapid growth of the financial economy, of debt as well as of enrichment. The periodic crash is programmed, so to speak. This time, however, it coincides with the wars of the U.S. empire for the preservation of its global domination and currency privilege. The West wanted to ruin Russia, now the banks are falling over here. What will happen if China is messed with? Moody's rating is not so unfounded.
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
China's peace plan
U.S. fears being cornered by Chinese proposal
While German media claim that the Chinese peace proposal for Ukraine is not taken seriously internationally, the truth is quite different.
[This article posted on 3/24/2023 is translated from the German on the Internet, https://www.anti-spiegel.ru/2023/usa-befuerchten-durch-den-chinesischen-vorschlag-in-die-enge-getrieben-zu-werden/?doing_wp_cron=1679738789.2438399791717529296875.]
German media like to call the peace plan presented by China an "alleged" peace plan, and they have continuously claimed during the Chinese president's Moscow visit that the plan is not to be taken seriously and is "internationally controversial." This formulation is only partly correct, because the fact that the plan is internationally controversial is mainly due to the fact that the West rejects it. However, the West is quite alone in this internationally.
The Chinese peace plan is reasonable because it also takes into account the past history of the conflict, which must be resolved if there is to be a negotiated peace that ends the bloodshed. And as we know, the West has played a major role in that back story by ignoring Russia's security interests and arming Ukraine and pushing its NATO accession. That was the main reason for the escalation of the war a year ago.
There are legally valid agreements between the West and Russia, which state that no state may impose its security interests at the expense of the security interests of another state. It is precisely this agreement that the West violated when it pushed for Ukraine's NATO accession. China's peace plan envisions, among other things, that this provision will also be established worldwide, which the U.S.-led West does not like at all.
German media consumers, however, know nothing about this because the German media keep quiet about this and other details and background of the Chinese peace plan. But in the rest of the world they know all this very well, which is why China's peace plan is not criticized outside the West, but welcomed as quite reasonable.
They know this in the U.S., too, as Bloomberg has now reported. According to Bloomberg, the U.S. government is very worried about the Chinese peace plan because the U.S. rejection of the plan openly shows the rest of the world that the U.S. is not interested in peace in Ukraine. I have translated the Bloomberg article so that German readers can make up their own minds.
Start of translation:
U.S. fears war-weary world may accept China's peace offer for Ukraine
U.S. on sidelines as Sino-Russian "brotherly festival" solidifies ties
Some uncomfortable realities of Xi's visit with Putin in Moscow
Xi Jinping's meeting with Vladimir Putin in Moscow put the Biden administration in an uncomfortable position: standing on the sidelines as their two adversaries discussed a peace proposal for Ukraine that the United States found unacceptable.
U.S. officials have publicly expressed strong skepticism about the Chinese idea, claiming that calling for a cease-fire would reward Moscow's invasion by cementing its territorial gains. Secretly, however, the meetings and the proposal have created a sense of unease within the government, which in turn has led to questions about the overall U.S. attitude toward the two countries.
According to one administration official, who asked not to be named because he is discussing internal deliberations, the U.S. fears being cornered by the Chinese proposal. Regardless of U.S. reservations, if it rejects the proposal outright, China could give the impression to other nations tired of the war - and the economic damage it is doing - that Washington is not interested in peace.
If the U.S. rejects the agreement, "China is likely to increasingly spread the message that the U.S. is against a cease-fire, that the U.S. is against ending the war," said Bonny Lin, a fellow at the Center for Strategic and International Studies who formerly served in the Pentagon. "There will be many ways China will try to interpret the results of the China-Russia meeting in a way that portrays the U.S. in a negative light."
The debate over China's version of a peace plan is just one of the many unpleasant aspects of Xi's three-day visit to Moscow this week, during which the Chinese leader was warmly welcomed by Putin. The two countries promised to deepen their partnership even further.
The Biden administration has tried to keep China on the sidelines since the invasion of Ukraine began, but the opposite seems to have happened. As Xi and Putin grow closer, China is finding a receptive audience for its broader diplomatic efforts around the globe.
At a Senate hearing Wednesday, Sen. Jeff Merkley asked Secretary of State Antony Blinken to comment on what the Oregon Democrat called a "three-day brotherfest with Putin and Xi celebrating their authoritarian power." Blinken acknowledged that it was a continuation of the two nations' pledge just before the war to maintain a "partnership without borders."
"It's not a surprise - both countries have very different world views than we do," Blinken said. "They could find common cause in opposing the worldview that we and so many other countries around the world are trying to defend and advance."
Blinken did not mention all the countries that have refused to take sides despite U.S. urging.
China has defied U.S. sanctions because of its companies' partnership with Russia, bought oil from the Iranian regime despite Western warnings, and helped bring about a diplomatic détente between Saudi Arabia and Iran. Major global economic powers such as India and Brazil refuse to choose between China and the West, saying they do not want a new Cold War.
And a week ago, Honduras began abandoning diplomatic relations with Taiwan in favor of economic ties with China.
The move was "a sign of my determination to fulfill the government plan and freely expand borders in harmony with the nations of the world," President Xiomara Castro said in a tweet.
Deteriorating ties
All of this comes at a time when U.S.-China relations, which began to crumble with former President Donald Trump's trade war, continue to deteriorate. That was underscored by the furor over the alleged Chinese spy balloon, which sparked a national outcry in the U.S. and angry recriminations between Washington and Beijing.
The episode scuttled an attempt to stabilize relations late last year with a face-to-face summit between President Joe Biden and Xi in Indonesia. That led to a tense meeting between Secretary of State Antony Blinken and top Chinese diplomat Wang Yi in Munich, and Xi later warned of "comprehensive containment and repression by Western countries led by the United States."
U.S. officials argue that their sharp words to Beijing are having an effect. They say that public U.S. warnings that China could provide lethal aid to Russia have made the Xi government think twice about the idea. The U.S. continues to supply Ukraine with weapons - it announced $325 million worth of new munitions this week - in coordination with European countries that are themselves drawing up new supply plans.
The Biden administration has tried to get China to confront the Ukraine crisis on U.S. terms, but "Xi is now interfering on his terms," said Christopher K. Johnson, president of China Strategies Group, a political risk consulting firm. "And I think that's likely to cause some confusion within the administration."
With Washington constantly taking a hard line on China, some analysts believe China may have effectively given up on improving relations with the U.S. anytime soon.
The less China sees the possibility of working with the U.S., "the more likely it is to pursue these other avenues and options," said Melanie Sisson, a foreign policy fellow at the Brookings Institution. "And in many ways and places, that's going to mean they're going to try to fray U.S. relations with other countries."
End of translation
In my new book ""Putin's Plan - With Europe and the U.S. the World Does Not End - How the Western System Is Just Destroying Itself "" I address the question of what the final battle of systems - which we are experiencing right now - is really about. We are witnessing nothing less than the battle of two systems in which Vladimir Putin is offering the world an alternative to neoliberal globalism. Have citizens in the West been asked if they want all this, if they want to give up their prosperity and freedoms in favor of neoliberal globalism?New old financial crisis
by Klaus Wagener
[This article posted on 3/24/2023 is translated from the German on the Internet, https://www.unsere-zeit.de/neue-alte-finanzkrise-4778421/.]
1206 Silicon Valley Bank Temple Arizona - New old financial crisis - banking crisis, Credit Suisse, First Republic Bank, Signature Bank, Silicon Valley Bank, Silvergate Corporation - International
Silicon Valley Bank is not the only bank to stumble in the U.S. in recent weeks, either. (Photo: Tony Webster / flickr / CC BY 2.0)
The US banking crisis has reached Europe. The old but less venerable Credit Suisse (CS), founded in 1856 as Schweizerische Kreditanstalt, then anglicized "Credit Suisse Group" in 1997, is in danger of toppling unless it is rescued as "systemically important."
CS still had total assets of 787.2 billion Swiss francs in 2019. However, the bank's share price had more than halved in the crisis since 2008, from 54.21 euros in 2007 to around 20 euros, and has now fallen to a meager 2.04 euros (as of March 17). CS securities are not far from being classified as junk bonds.
Since Silicon Valley Bank, Silvergate Corporation, and Signature Bank all toppled within a week in the U.S., and now First Republic Bank has also run into trouble, there are increasing signs that the next big financial crisis, which was only postponed in 2019 by tons of freshly printed central bank money, could now erupt with force. Some $9 trillion has been injected into the "U.S. market" since 2019. The rating agency Moody's has rated the outlook of the entire U.S. banking sector as "negative." The Swiss National Bank has announced its intention to bail out CS with a whopping 50 billion Swiss francs.
The neoliberal financial and banking system of the West, and especially that of the USA, fell into a deep structural crisis at the beginning of the century. The exclusive focus on the profit of the super-rich has so far produced three major outbreaks of crisis. The dotcom crisis of 2000, the financial crisis of 2008 ff. and the current crisis of 2019/2023. These crises are not simply a repetition of the previous crisis in each case, but they reach a much higher level because the bubble, the crisis level or the disproportion created by the central bank "bailout" becomes massively larger each time.
Between the two crises of 2008 onwards and 2023 onwards, there are 13 years of quantitative easing (QE), zero interest rate policies and an unprecedented monetary and debt explosion. This gigantic fattening of the rich had driven stock prices and thus the speculative fortunes of finance capital to astronomical heights - at the expense of gutted and exported industrial capital. Then last year, however, the U.S. Federal Reserve (Fed) and, in its wake, the ECB ended the party and began to creep interest rates to normal levels. Real inflation had easily exceeded the 10 percent mark. Fed Chairman Jerome Powell's self-imposed task is now to prevent wages from rising to similar levels.
A similar task had already been set by then Fed Chairman Paul Volcker when he raised interest rates to as high as 20 percent in 1980. However, before the Volcker shock, the U.S. debt-to-GDP ratio was 31.6 percent. Today, that figure is 125 percent/GDP ($31.6 trillion).
A significant change in the level of interest rates now has serious economic consequences. The interest rate on a 30-year U.S. mortgage in November 2022 was a whopping 6.95 percent. If U.S. credit only reached that level, it would mean an interest burden of $6.57 trillion for U.S. society as a whole, or about 30 percent of total U.S. economic output. This is hardly likely to be representable. The neoliberal financial system has been maneuvered by its protagonists into a dead end in which the only choice is between plague and cholera.
In the crisis of 2008 onwards, there was fraud on a very large scale, covered by the Bush warriors. There were the subprime or NINJA loans ("No Income, No Job, No Assets"), the multiple repackaging of the credit junk, the triple-A ratings, the hawking of all the junk and so on. The current crisis shows that it can be done without. The current imbalances are not so much a consequence of criminal machinations, but rather the result of the gigantic securities and debt inflation that has been pursued by the major central banks for more than a decade and that is now preventing a return to "normality."
The basic problem of neoliberally de-limited financial capitalism is that the growth curve of the real economy cannot keep up at all with the rapid growth of the financial economy, of debt as well as of enrichment. The periodic crash is programmed, so to speak. This time, however, it coincides with the wars of the U.S. empire for the preservation of its global domination and currency privilege. The West wanted to ruin Russia, now the banks are falling over here. What will happen if China is messed with? Moody's rating is not so unfounded.
___________________________________________________________________
China's peace plan
U.S. fears being cornered by Chinese proposal
While German media claim that the Chinese peace proposal for Ukraine is not taken seriously internationally, the truth is quite different.
[This article posted on 3/24/2023 is translated from the German on the Internet, https://www.anti-spiegel.ru/2023/usa-befuerchten-durch-den-chinesischen-vorschlag-in-die-enge-getrieben-zu-werden/?doing_wp_cron=1679738789.2438399791717529296875.]
German media like to call the peace plan presented by China an "alleged" peace plan, and they have continuously claimed during the Chinese president's Moscow visit that the plan is not to be taken seriously and is "internationally controversial." This formulation is only partly correct, because the fact that the plan is internationally controversial is mainly due to the fact that the West rejects it. However, the West is quite alone in this internationally.
The Chinese peace plan is reasonable because it also takes into account the past history of the conflict, which must be resolved if there is to be a negotiated peace that ends the bloodshed. And as we know, the West has played a major role in that back story by ignoring Russia's security interests and arming Ukraine and pushing its NATO accession. That was the main reason for the escalation of the war a year ago.
There are legally valid agreements between the West and Russia, which state that no state may impose its security interests at the expense of the security interests of another state. It is precisely this agreement that the West violated when it pushed for Ukraine's NATO accession. China's peace plan envisions, among other things, that this provision will also be established worldwide, which the U.S.-led West does not like at all.
German media consumers, however, know nothing about this because the German media keep quiet about this and other details and background of the Chinese peace plan. But in the rest of the world they know all this very well, which is why China's peace plan is not criticized outside the West, but welcomed as quite reasonable.
They know this in the U.S., too, as Bloomberg has now reported. According to Bloomberg, the U.S. government is very worried about the Chinese peace plan because the U.S. rejection of the plan openly shows the rest of the world that the U.S. is not interested in peace in Ukraine. I have translated the Bloomberg article so that German readers can make up their own minds.
Start of translation:
U.S. fears war-weary world may accept China's peace offer for Ukraine
U.S. on sidelines as Sino-Russian "brotherly festival" solidifies ties
Some uncomfortable realities of Xi's visit with Putin in Moscow
Xi Jinping's meeting with Vladimir Putin in Moscow put the Biden administration in an uncomfortable position: standing on the sidelines as their two adversaries discussed a peace proposal for Ukraine that the United States found unacceptable.
U.S. officials have publicly expressed strong skepticism about the Chinese idea, claiming that calling for a cease-fire would reward Moscow's invasion by cementing its territorial gains. Secretly, however, the meetings and the proposal have created a sense of unease within the government, which in turn has led to questions about the overall U.S. attitude toward the two countries.
According to one administration official, who asked not to be named because he is discussing internal deliberations, the U.S. fears being cornered by the Chinese proposal. Regardless of U.S. reservations, if it rejects the proposal outright, China could give the impression to other nations tired of the war - and the economic damage it is doing - that Washington is not interested in peace.
If the U.S. rejects the agreement, "China is likely to increasingly spread the message that the U.S. is against a cease-fire, that the U.S. is against ending the war," said Bonny Lin, a fellow at the Center for Strategic and International Studies who formerly served in the Pentagon. "There will be many ways China will try to interpret the results of the China-Russia meeting in a way that portrays the U.S. in a negative light."
The debate over China's version of a peace plan is just one of the many unpleasant aspects of Xi's three-day visit to Moscow this week, during which the Chinese leader was warmly welcomed by Putin. The two countries promised to deepen their partnership even further.
The Biden administration has tried to keep China on the sidelines since the invasion of Ukraine began, but the opposite seems to have happened. As Xi and Putin grow closer, China is finding a receptive audience for its broader diplomatic efforts around the globe.
At a Senate hearing Wednesday, Sen. Jeff Merkley asked Secretary of State Antony Blinken to comment on what the Oregon Democrat called a "three-day brotherfest with Putin and Xi celebrating their authoritarian power." Blinken acknowledged that it was a continuation of the two nations' pledge just before the war to maintain a "partnership without borders."
"It's not a surprise - both countries have very different world views than we do," Blinken said. "They could find common cause in opposing the worldview that we and so many other countries around the world are trying to defend and advance."
Blinken did not mention all the countries that have refused to take sides despite U.S. urging.
China has defied U.S. sanctions because of its companies' partnership with Russia, bought oil from the Iranian regime despite Western warnings, and helped bring about a diplomatic détente between Saudi Arabia and Iran. Major global economic powers such as India and Brazil refuse to choose between China and the West, saying they do not want a new Cold War.
And a week ago, Honduras began abandoning diplomatic relations with Taiwan in favor of economic ties with China.
The move was "a sign of my determination to fulfill the government plan and freely expand borders in harmony with the nations of the world," President Xiomara Castro said in a tweet.
Deteriorating ties
All of this comes at a time when U.S.-China relations, which began to crumble with former President Donald Trump's trade war, continue to deteriorate. That was underscored by the furor over the alleged Chinese spy balloon, which sparked a national outcry in the U.S. and angry recriminations between Washington and Beijing.
The episode scuttled an attempt to stabilize relations late last year with a face-to-face summit between President Joe Biden and Xi in Indonesia. That led to a tense meeting between Secretary of State Antony Blinken and top Chinese diplomat Wang Yi in Munich, and Xi later warned of "comprehensive containment and repression by Western countries led by the United States."
U.S. officials argue that their sharp words to Beijing are having an effect. They say that public U.S. warnings that China could provide lethal aid to Russia have made the Xi government think twice about the idea. The U.S. continues to supply Ukraine with weapons - it announced $325 million worth of new munitions this week - in coordination with European countries that are themselves drawing up new supply plans.
The Biden administration has tried to get China to confront the Ukraine crisis on U.S. terms, but "Xi is now interfering on his terms," said Christopher K. Johnson, president of China Strategies Group, a political risk consulting firm. "And I think that's likely to cause some confusion within the administration."
With Washington constantly taking a hard line on China, some analysts believe China may have effectively given up on improving relations with the U.S. anytime soon.
The less China sees the possibility of working with the U.S., "the more likely it is to pursue these other avenues and options," said Melanie Sisson, a foreign policy fellow at the Brookings Institution. "And in many ways and places, that's going to mean they're going to try to fray U.S. relations with other countries."
End of translation
In my new book ""Putin's Plan - With Europe and the U.S. the World Does Not End - How the Western System Is Just Destroying Itself "" I address the question of what the final battle of systems - which we are experiencing right now - is really about. We are witnessing nothing less than the battle of two systems in which Vladimir Putin is offering the world an alternative to neoliberal globalism. Have citizens in the West been asked if they want all this, if they want to give up their prosperity and freedoms in favor of neoliberal globalism?
For more information:
http://www.freembtranslations.net
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