by Alastair Crooke.
The radical attitude adopted by the West with regard to Russia risks collapsing the entire economic system with which it has imposed its domination on the planet.
These “wars” are increasingly seen in the West as existential events – that is, “all or nothing” events – and their scope is widening. Why wars in the plural? Well, the military confrontation in Ukraine is about to reach its climax; the war over Russia’s sweeping changes to the global monetary order plunges Western states into a voiceless whirlwind; Europe is on the edge of the economic abyss; and the Russia-China ‘war’ to rearrange global ‘rules’ is also coming to an end (although it is traveling at a slightly slower pace).
The West’s PSYOPS war, however, is truly in a class of its own. The wall of toxicity that swells, rises and crashes on the shores of Russia represents a sea storm unlike any we have ever seen. His intention is clearly to blacken President Putin beyond “evil,” to turn him into such a twisted satanic demon that any sane Russian oligarch will rush to replace him with a more docile, Yeltsin-like figure.
Only, it doesn’t work. Western officials behind the PSYOPS “curtain” don’t know when to stop. They pull harder on the levers and turn the dials ever higher, until the surge of visceral hatred against all things Russian has created the opposite effect: not only is Putin more popular, but it has triggered in Russia a violent reaction against the West as a whole.
The net effect has therefore been precisely to turn the Ukraine question into a Manichean existential nightmare. The Anglo-Saxon world writes in headlines that “war is all or nothing”: If Putin is not defeated (in the sense of totally defeated in battle), the West simply cannot survive.
The problem with the West taking things to such an all-or-nothing climax is that it also risks being “nothing”. Indeed, it is clear that it is not allowed to discuss with the “evil” demonic forces: No political dialogue therefore. All or nothing.
The obvious corollary of this confrontation in binary terms of good and evil is that the rest of the world must be subjected to a grand inquisitor mechanism to discover, and then force, the heretics to recant any failure to support Ukraine against the Russia, on pain of being burned at the stake. The inquisitors are spreading all over the world: The Euro-recidivists are the first (the Orbàns); Pakistan, India, Turkey, Gulf States, etc. follow.
Only, once again, it doesn’t work. The non-West senses in the air an empire which is weakening, which vacillates, which stirs, like Hercules descending armed with his sword into Hades (the underworld) to fetch the three-headed dog Cerberus, whose one of the heads spreads human fear of what awaits us around the next corner. (Fear, indeed, rises.)
And that is what drives this all-or-nothing fear: The sea change presaged by Russia’s insistence on being paid in rubles (for now, only for gas deliveries) and by a ruble already resurgent, now tied to gold and commodities.
By playing on both sides: by linking the ruble to gold, then by linking energy payments to the ruble, the Bank of Russia and the Kremlin are fundamentally changing all the operating assumptions of the world trading system (by replacing transactions evanescent in dollars by solid currency transactions, backed by commodities), while triggering a reorientation of the role of gold as a bulwark of the monetary system.
If a majority of the international trading system begins to accept rubles for the supply of raw materials, it could propel what Wall Street guru Zoltan Pozsar predicts will be the death of the petrodollar and the arrival of Bretton Woods III ( i.e. a new world monetary order).
The world is watching intently. They can see the landscape moving. When the collective West seized all the foreign exchange reserves of the Central Bank of Russia, the latter decreed that Russian sovereign reserves in euros, dollars and US Treasury bills were no longer “good money”. They were worthless as “currency” to pay debts to foreign creditors.
The message was pretty clear: if even a major G20 state can have its reserves canceled in a jiffy, then for those who still hold “reserves” in New York, go get them elsewhere (while possible) ! Because the commercial currencies of tomorrow will be backed by raw materials, and no longer by constant dollars.
Of course, of those watching another aspect (market oil prices), the most observant will be China (with its huge gold reserves) and major crude producers who will perceive that Russia’s actions – if they continue – could lead to Russia not only snatching gold price determination from the LBMA and COMEX (bullion exchanges) but who knows, in combination with other producers, snatching gold price determination from oil on US commodity exchanges as well?
In a very real sense, the West senses an existential danger. We’re not just talking about dedollarization, but something more fundamental. The Western financial system is made up of an inverted pyramid of highly leveraged paper money “instruments” (many of which are known as derivatives), resting on the smallest base, the top of the pyramid. reversed. This is called “internal money”.
It is of a greater magnitude than its collateral supports at its base – sometimes called “outer silver”. External money represents something real: oil, gas, energy, food, metals, etc. A guarantee that is real.
Remove outer money from the base of the inverted pyramid…and (potentially), crash.
Well, that’s what’s happening. Putin is pushing Russian gas away from the base of the pyramid by insisting that the entire payment process, and the collateral value, remain within the realm of the ruble. And if other states follow suit and extend it to other commodities… Crash.
The irony is that the West has brought this situation upon itself. Putin didn’t do it. They did it. They did it when Russia-phobic “hawks” in Washington stupidly started a fight with the only country – Russia – that has the raw materials needed to run the world, and to trigger the switch to a different monetary system – an alternative system, rooted in something other than fiat currency, backed by nothing but the Federal Reserve’s ability to print dollars ad infinitum.
And then they destroyed the “full faith and promise” of the US Treasury to commit to contractual payment – by stealing Russian reserves.
source: Al Mayadeen
International Network translation