Secret wealth of Chinese leaders revealed

[Scientific Playa]

How to really stash and stack!!!!!!



January 22, 2014 1:47 am

Secret wealth of Chinese leaders revealed
By Paul J Davies in Hong Kong

The secret financial holdings of the families of China’s leaders from Xi Jinping to Deng Xiaoping have been exposed in a massive leak of documents to the International Centre for Investigative Journalism.

Family members of more than a dozen military and political leaders are among the 21,000 mainland Chinese and Hong Kong residents using off-shore tax havens in the Caribbean to store their wealth, according to the disclosures.

President Xi Jinping’s brother in law, the son and son in law of Wen Jiabao and the son in law of Deng Xiaoping are among those named by the ICIJ.

The revelations come amid a crackdown on corruption in China led by President Xi that has taken down some of the most powerful people ever targeted directly in China, including Zhou Yongkang, former head of internal security.

President Xi and former president Wen have also seen the wealth of family members exposed in investigative articles by Bloomberg and the New York Times respectively, leading to their websites being blocked in China.

The disclosure are part of a two-year project at the ICIJ called “Offshore secrets”, which obtained masses of data from two companies based in the British Virgin Islands and shared it with a handful of international news media.

The documents also detail the role of western banks and accountants such as PwC, Credit Suisse and UBS in helping the Chinese and Hong Kong nationals set up their offshore financial structures.

The clients set up various holding companies, which are often used to house investments or to establish bank accounts, but the documents give no details of what many of the companies are actually used for. It is not illegal to own offshore companies in China.

Beyond the relations of the political elite named in the documents, 16 of China’s richest people worth a combined $45bn have connections with companies in the British Virgin Islands, according to the Guardian, one of the newspapers working with the iCIJ.

 

[Tommy Knocks]

Sounds about right, elites from every country do it.

 

[Scientific Playa]

Leaked Records Reveal Offshore Holdings of China’s Elite

http://www.icij.org/offshore/leaked-records-reveal-offshore-holdings-chinas-elite

By Marina Walker Guevara, Gerard Ryle, Alexa Olesen, Mar Cabra, Michael Hudson and Christoph Giesen
January 21, 2014, 4:00 pm
Key Findings

• Government officials and their families and associates in China, Azerbaijan, Russia, Canada, Pakistan, the Philippines, Thailand, Mongolia and other countries have embraced the use of covert companies and bank accounts.
• The mega-rich use complex offshore structures to own mansions, yachts, art masterpieces and other assets, gaining tax advantages and anonymity not available to average people.
• Many of the world’s top’s banks – including UBS, Credit Suisse and Deutsche Bank – have aggressively worked to provide their customers with secrecy-cloaked companies in the British Virgin Islands and other offshore hideaways.
• A well-paid industry of accountants, middlemen and other operatives has helped offshore patrons shroud their identities and business interests, providing shelter in many cases to money laundering or other misconduct.
• Ponzi schemers and other large-scale fraudsters routinely use offshore havens to pull off their shell games and move their ill-gotten gains.

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About This Project
The goals, team members, and media partners of this multi-year project.

Files shed light on nearly 22,000 tax haven clients from Hong Kong and mainland China.

Note: A Chinese version of this story is available here

Close relatives of China’s top leaders have held secretive offshore companies in tax havens that helped shroud the Communist elite’s wealth, a leaked cache of documents reveals.

The confidential files include details of a real estate company co-owned by current President Xi Jinping’s brother-in-law and British Virgin Islands companies set up by former Premier Wen Jiabao’s son and also by his son-in-law.

Nearly 22,000 offshore clients with addresses in mainland China and Hong Kong appear in the files obtained by the International Consortium of Investigative Journalists. Among them are some of China’s most powerful men and women — including at least 15 of China’s richest, members of the National People’s Congress and executives from state-owned companies entangled in corruption scandals.

PricewaterhouseCoopers, UBS and other Western banks and accounting firms play a key role as middlemen in helping Chinese clients set up trusts and companies in the British Virgin Islands, Samoa and other offshore centers usually associated with hidden wealth, the records show. For instance, Swiss financial giant Credit Suisse helped Wen Jiabao’s son create his BVI company while his father was leading the country.

The files come from two offshore firms — Singapore-based Portcullis TrustNet and BVI-based Commonwealth Trust Limited — that help clients create offshore companies, trusts and bank accounts. They are part of a cache of 2.5 million leaked files that ICIJ has sifted through with help from more than 50 reporting partners in Europe, North America, Asia and other regions.

Since last April, ICIJ’s stories have triggered official inquiries, high-profile resignations and policy changes around the world.

Until now, the details on China and Hong Kong had not been disclosed.

The data illustrates the outsized dependency of the world’s second largest economy on tiny islands thousands of miles away. As the country has moved from an insular communist system to a socialist/capitalist hybrid, China has become a leading market for offshore havens that peddle secrecy, tax shelters and streamlined international deal making.

Every corner of China’s economy, from oil to green energy and from mining to arms trading, appears in the ICIJ data.

Xi Jinping and Wen Jiabao: relatives appear in ICIJ's data.

Chinese officials aren’t required to disclose their assets publicly and until now citizens have remained largely in the dark about the parallel economy that can allow the powerful and well-connected to avoid taxes and keep their dealings secret. By some estimates, between $1 trillion and $4 trillion in untraced assets have left the country since 2000.

The growing onshore and offshore wealth of China’s elites “may not be strictly illegal,” but it is often tied to “conflict of interest and covert use of government power,” said Minxin Pei, a political scientist at Claremont McKenna College in California. “If there is real transparency, then the Chinese people will have a much better idea of how corrupt the system is [and] how much wealth has been amassed by government officials through illegal means.”

Top-level corruption is a politically sensitive issue in China as the country's economy cools and its wealth gap continues to widen. The country’s leadership has cracked down on journalists who have exposed the hidden wealth of top officials and their families as well as citizens who have demanded that government officials disclose their personal assets.

I

 

[Scientific Playa]

In November, a mainland Chinese news organization that was working with ICIJ to analyze the offshore data withdrew from the reporting partnership, explaining that authorities had warned it not to publish anything about the material.
READ: HOW WE WORKED TO REPORT THIS STORY SECURELY IN CHINA
----------------
ICIJ is keeping the identity of the news outlet confidential to protect journalists from government retaliation. Other partners in the investigation include the Hong Kong newspaper Ming Pao, the Taiwanese magazine CommonWealth and the German newspaper Süddeutsche Zeitung.

The ICIJ team spent months sifting through the files and the leaked lists of offshore users. In most cases, names were registered in Romanized form, not Chinese characters, making matching extremely difficult. Many offshore users had provided a passport as well as an address when they set up their companies, which made it possible to confirm identities in many but not all cases. Some suspected princelings and officials in the files could not be confirmed and have not been included in this story.

Along with the China and Hong Kong names, ICIJ’s files also include the names of roughly 16,000 offshore clients from Taiwan. ICIJ will continue to publish stories with its partners in the next few days and will release the Greater China names on its Offshore Leaks Database on Jan. 23.
Princelings go offshore
China's Politburo Standing Committee is the all-powerful group of seven (formerly nine) men who run the Communist Party and the country. The records obtained by ICIJ show that relatives of at least five current or former members of this small circle have incorporated companies in the Cook Islands or British Virgin Islands.

China’s “red nobility” — elites tied by blood or marriage to the current leadership or Party elders — are also popularly known as “princelings.” Ordinary Chinese have grown increasingly angry over their vast wealth and what many see as the hypocrisy of officials who tout “people-first” ideals but look the other way while their families peddle power and influence for personal gain.

The leaked offshore records include details of a BVI company 50 percent owned by President Xi’s brother-in-law Deng Jiagui. The husband of Xi’s older sister, Deng is a multimillionaire real estate developer and an investor in metals used in cell phones and other electronics. The records show the other half of Excellence Effort Property Development was owned by yet another BVI company belonging to Li Wa and Li Xiaoping, property tyc00ns who made news in July by winning a $2 billion bid to purchase commercial real estate in Shenzhen.

Since taking over as the Communist Party’s top official in 2012, Xi has sought to burnish his image with an aggressive anti-graft campaign, promising to go after official corruption involving both low-level “flies” and high-level “tigers.” Yet he has crushed a grassroots movement that called for government officials to publicly declare their assets. Wen Jiabao, who stepped down as premier in 2013 after a decade-long tenure, also styled himself as a reformer, cultivating an image of grandfatherly concern for China’s poor.

The ICIJ offshore files reveal that Wen’s son Wen Yunsong set up a BVI-registered company, Trend Gold Consultants, with help from the Hong Kong office of Credit Suisse in 2006. Wen Yunsong was the lone director and shareholder of the firm, which appears to have been dissolved in 2008.

Bare-bones company structures are often created to open bank accounts in the offshore firm’s name, helping obscure the relationship to the real account owner. It isn’t immediately clear from the documents what Trend Gold Consultants was used for. A U.S.-educated venture capitalist, Wen Yunsong co-founded a China-focused private equity firm and in 2012 became chairman of China’s Satellite Communications Co., a state-owned firm that aspires to be Asia’s largest satellite operator.

ICIJ made repeated attempts to reach Wen Yunsong and other individuals named in this story. Only a few responded. Wen was among those who did not. Citing confidentiality rules, a Credit Suisse spokesman said the bank is “unable to comment on this matter.”

 

[Scientific Playa]

The ICIJ files also shed light on the BVI’s previously unreported role in a burgeoning scandal involving Wen Jiabao’s daughter, Wen Ruchun, also known as Lily Chang. The New York Times has reported that JPMorgan Chase & Co. paid a firm that she ran, Fullmark Consultants, $1.8 million in consulting fees. U.S. securities regulators are investigating the relationship as part of a probe into the bank’s alleged use of princelings to increase its influence in China.

Fullmark Consultants appears to have been set up in a manner that obscured Wen Ruchun’s relationship to the firm, the ICIJ files indicate. Her name does not show up in any of the incorporation documents in the ICIJ data, though a 'Lily Chang' is CC’d in one August, 2009 email correspondence about the company. Her husband Liu Chunhang, a former Morgan Stanley finance guru, created Fullmark Consultants in the BVI in 2004 and was the sole director and shareholder of the firm until 2006, the same year he took a government job at the agency that regulates China’s banking industry.

Liu transferred control of the company, the ICIJ files show, to a Wen family friend, Zhang Yuhong, a wealthy businesswoman and colleague of Wen Jiabao’s brother. The Times reported that Zhang also helped control other Wen family assets including diamond and jewelry ventures.

The ICIJ files show that offshore provider Portcullis TrustNet billed UBS AG for a certificate of good standing for Fullmark Consultants in October 2005, indicating a business relationship between Fullmark and the Swiss bank. In response to ICIJ’s questions, UBS issued a statement saying its “know-your-client” policies as well as procedures to deal with politically-sensitive clients are among “the strictest in the industry.” Liu and Zhang did not respond to ICIJ's requests for comment.

A 2007 U.S. Department of State cable passed along a source’s tip that Premier Wen was “disgusted with his family’s activities,” and that “Wen’s wife and children all have a reputation as people who can ‘get things done’ for the right price.” The cable, part of the Wikileaks document dump, reported that Wen’s kin “did not necessarily take bribes, [but] they are amenable to receiving exorbitant ‘consulting fees.’ ”

The records also include incorporations by relatives of Deng Xiaoping, former Premier Li Peng, and former President Hu Jintao.

China experts say that the growing wealth and business interests of the princelings, including offshore holdings, are a dangerous liability for the ruling Communist Party but that people in leadership positions are too involved to stop it.

“What’s the point of running the Communist Party if you can’t get a couple billion for your family?” said Steve dikkinson, a China-based American lawyer who has investigated fraud cases involving BVI companies. “The issue is enormous and has tremendous significance for China, and the fact that everybody dances around it and doesn’t want to talk about it is understandable but scandalous.”

China embraces offshore
The story of China’s involvement with the offshore world begins with paramount leader Deng Xiaoping’s deepening of economic reforms in the early 1990s.

Laws reorganizing China’s economy drove many Chinese offshore because they were written with state-owned enterprises in mind, not fledgling ventures like the entrepreneur trying to “market the latest iPhone app,” according to Don Clarke, a China specialist at the George Washington University Law School in Washington, D.C.

Western bankers, accountants and investors wary of doing business on strictly Chinese terms also pushed the offshore model.

“It was us, the foreigners, that imposed this,” said Rocky Lee, head of the Greater China corporate law practice of Cadwalader, Wickersham & Taft. “It had to do with the foreign investors’ general discomfort with Chinese rules and regulations.”

Other factors — including tightened capital controls within China as a result of the 1990s Asian debt crisis — also nudged Chinese offshore. Many had flocked to Hong Kong, then still a British territory, to incorporate businesses. As the 1997 handover back to China approached, though, Hong Kong itself began to look risky and many companies sought more far-flung offshore destinations.

The British Virgin Islands became a favorite haven for Chinese wanting to move businesses and cash offshore.

China’s tax regime favored foreign investment, helping fuel the push to incorporate in the BVI and other offshore centers. Some Chinese manufacturers, for example, reduced their taxes by a maneuver known as “round-tripping” — setting up subsidiaries outside the country, then selling their products at low cost to the subsidiaries, allowing the parent companies to avoid taxes by showing little or no profits inside China. The offshore entities in turn resold the goods at profitable markup — then slipped the profits back to the parents as untaxed “foreign investment” from the BVI or Hong Kong.

Today 40 percent of the BVI’s offshore business comes from China and other Asian nations, according to BVI authorities.

Every corner of China’s economy, from oil to green energy and from mining to arms trading, appears in the ICIJ data

Frank Savage, the BVI’s governor from 1998 to 2002, says the islands helped cultivate the relationship by persuading Chinese authorities that they were a “well-regulated territory with a robust and sound legal system.”

Critics of the offshore system, though, see the BVI in a different light — as a “no-questions-asked” haven for shadowy dealings. Tax Justice Network, an advocacy group, says BVI offshore entities have been linked to “scandal after scandal after scandal” — the result of a corporate secrecy regime that creates an “effective carte blanche for BVI companies to hide and facilitate all manner of crimes and abuses.”

Among the important Chinese who went offshore in the late 1990s was Fu Liang, the son of Peng Zhen, one of the “Eight Elders” of the Communist Party and a top leader of the National People’s Congress in the 1980s.

Offshore Leaks records show Fu — who has invested in yachting clubs and golf courses on the mainland — controlled at least five offshore companies established in the BVI between 1997 and 2000. He used one of them, South Port Development Limited, to acquire a Philippines hotel in 2000.

TrustNet, the offshore services provider, helped Fu set up some of his offshore companies. By 2000, Trustnet was among the offshore services firms that were making an all-out drive to sign up clients from China, doing marketing meetings at the Shanghai offices of what were then known as the “Big 5” accounting firms: KPMG, Ernst & Young, Pricewaterhouse, Deloitte & Touche, and Arthur Andersen.

The audit firm now known as PricewaterhouseCoopers helped incorporate more than 400 offshore entities through TrustNet for clients from the mainland, Hong Kong and Taiwan, the ICIJ records show. Swiss banking giant UBS helped set up more than 1,000 offshore structures via TrustNet for clients from those three markets.

UBS Hong Kong helped Yang Huiyan, China's richest woman, with an estimated net worth of US$ 8.3 billion, establish a BVI company in 2006. Yang, who inherited a real estate fortune from her father, did not respond to questions about her offshore company, Joy House Enterprises Limited.

 

[Scientific Playa]

The following year the Swiss bank referred another Chinese real estate billionaire, Zhang Xin, to TrustNet. Zhang, founder of Soho China, a company that has reshaped much of the Beijing skyline, recently made headlines by buying a $26 million Manhattan townhouse. Through a representative, Zhang declined to answer questions about her BVI company Commune Investment Ltd., a name similar to that of her exclusive boutique hotel outside Beijing, the Commune by the Great Wall.

Li Jinyuan, a business tyc00n and philanthropist with a net worth estimated at $1.2 billion in 2011, was director of seven BVI companies that PricewaterhouseCoopers helped incorporate between 2004 and 2008. According to the ICIJ files, the BVI companies appear to be connected to his Tiens Group conglomerate, which has interests in biotechnology, tourism, e-commerce and real estate.

In a 2005 marketing memo marked “strictly private and confidential,” TrustNet staffers were encouraged to improve ties with Credit Suisse in Hong Kong. They courted Credit Suisse and UBS with wine and cheese sessions. On the mainland, where foreign banks were restricted, they took a different tack: “In Shanghai, we will target international law firms and accounting firms,” the 2005 memo says.

The marketing campaign paid off. The number of companies TrustNet set up for clients in China, Hong Kong and Taiwan tripled from 1,500 to 4,800 between 2003 and 2007.

The TrustNet clients who incorporated companies during this period include two current delegates to the National People's Congress, China's legislature.

Wei Jianghong, who represents Anhui province in the legislature while serving as chairman of state-owned Tongling Nonferrous Metals, was a director of Tong Guan Resources Holdings, a BVI company set up in 2006. Tongling used Tong Guan to invest $10 million in a $50 million copper processing project in Chile in 2007.

Another delegate with offshore holdings is Ma Huateng, the founder of China's leading online chat company, Tencent. Ma is worth $10 billion and is ranked No. 5 on Forbes’ list of billionaires in China. In 2007, he became director of TCH Pi Limited in the BVI with fellow Tencent founder Zhang Zhidong.

A spokeswoman for Ma said TCH Pi is a Tencent company that “has nothing to do with [Ma or Zhang] personally,” but the firm doesn't show up in Tencent corporate filings, and its purpose isn't clear.

Profits and corruption
Things have changed dramatically for China since it first dipped its toe into the offshore world. The country is wealthier and offshore centers serve increasingly as channels not only for capital that “round-trips” out of the country and back again, but also for overseas investment and accessing markets for metals, minerals and other resources.

Defenders of China’s offshore push say the offshore system has helped boost the country’s economy.

“I think we should face the reality, which is that Chinese capital is flowing out. I think it’s actually a beneficial thing,” said Mei Xinyu, a researcher at China’s Commerce Ministry. “Of course I support the idea that a company should incorporate in its host country. But if the host country can't provide the right environment, then incorporating the company in an offshore center is actually a practical choice.”

With markets in China often hamstrung by red tape and government intervention, incorporating offshore can smooth the way to do business, said William Vlcek, author of Offshore Finance and Small States: Sovereignty, Size and Money.

There’s also evidence, though, that many Chinese companies and individuals have used offshore entities to engage in illicit or illegal behavior.

In September Zhang Shuguang, a former high-level Chinese railway executive, pleaded guilty to criminal charges in the wake of allegations that he’d funneled $2.8 billion into offshore accounts. An internal government report released by the Bank of China revealed that public officials — including executives at state-owned companies — had embezzled more than $120 billion out of China since the mid-1980s, some of it funneled through the BVI.

Portcullis TrustNet helped state-run shipping giant Cosco incorporate a BVI company in 2000. Among the numerous directors of Cosco Information Technology Limited were current Cosco Group chairman Ma Zehua and Song Jun, an executive who would stand trial in 2011 for embezzlement and bribery. After Cosco sent Song to help oversee a Qingdao subsidiary in 2001, he set up a fake BVI joint venture partner and used it to siphon millions from the building of Qingdao’s gleaming Cosco Plaza, prosecutors said. State news service Xinhua said he embezzled $6 million, took $1 million in bribes from a Taiwanese business partner and purchased 37 apartments in Beijing, Tianjin and Qingdao with his ill-gotten earnings. His trial was adjourned but no verdict was publicly announced.

China’s corruption-plagued oil industry — which recently has been the target of criminal investigations that have led to the suspension of key oil executives — is a big player in the offshore world. China’s three big state-owned oil companies, which are counted among the largest companies in the world, are linked to dozens of BVI firms that show up in the ICIJ data.

 

[Scientific Playa]

Former PetroChina executive Li Hualin, who was dismissed in August after coming under investigation for alleged “serious violations of discipline”, often a party shorthand for corruption, was the director of two BVI companies, the ICIJ files reveal.

While some of these offshore firms are disclosed in corporate filings, several others linked to individual executives — including Zhang Bowen of PetroChina’s natural gas distribution arm Kunlun Energy and Yang Hua of China National Offshore Oil Corporation — appear to operate in the dark, and their purpose is not clear. PetroChina and CNOOC did not respond to ICIJ’s repeated requests for comment.

Other scandal-tainted Chinese who have used the BVI to do business include Huang Guangyu, once China’s richest man. The ICIJ records show that he and his wife Du Juan set up a maze of at least 31 BVI companies between 2001 and 2008 as they built the largest consumer electronics retail chain in China.

The husband, Huang, was sentenced to 14 years in prison in 2010 after Chinese courts convicted him of insider trading, bribery and stock price manipulation. Du Juan was convicted of related charges but was released from prison in 2010 after serving a brief time.





While Huang is in prison and many of his assets are frozen, his business empire survives through his offshore network of companies. In 2011, one of his BVI firms, Eagle Vantage Assets Management, made a bid for a retired British aircraft carrier that Huang wanted to turn into a luxury shopping mall (the Brits in the end decided to scrap the ship).

He still owns more than 30 percent of Gome, his electronics retailer, via two companies in the BVI, Shining Crown Holdings and Shine Group.

Offshore’s future
As concerns grow about the wealth of corporate oligarchs, government officials and their families, some Chinese have braved the government’s anger by raising questions about corruption.

A grassroots group, the New Citizens Movement, uses the Internet and small demonstrations to press for greater transparency. “How can you fight corruption if you don’t even dare to disclose your personal assets?” the group’s founder, legal advocate and activist Xu Zhiyong, wrote last spring.

The government’s response has been swift. It has arrested Xu and detained more than 20 other members of the group, indicting some for “disturbing public order” or “illegal assembly,” charges frequently used to silence dissidents.

The government has also cracked down on foreign media that have focused attention on the gap between wealth and poverty in China. After The New York Times and Bloomberg News reported on the onshore assets of China’s princelings, the government blocked their websites and delayed approving visas for their journalists.

After years of inaction, the U.S., the U.K. and international organizations have begun pushing reforms that, they say, would reduce offshore abuses. China has been less aggressive in pressing for changes in the offshore system.

Big loopholes in tax laws have allowed Chinese individuals to operate with relative freedom offshore. They weren’t required to report their foreign holdings.

“Chinese policy makers didn’t envision individuals absconding with that much money,” Lee, the Beijing-based corporate lawyer, said.

Now mainland authorities are moving to get a handle on the flow of private wealth offshore. New rules that went into effect Jan. 1 require Chinese to report their overseas assets.

How aggressively China joins global efforts to reshape the offshore system may have a big impact on the current push for reform. Just as China has become an increasingly important player in the global economy, it has also become more important as a supplier of clients to the market for offshore accounts and companies.

A 2013 industry-sponsored poll of 200-plus bankers and other offshore professionals found that “China-related demand” is the key driver in the offshore market’s growth. The chief of a BVI offshore services firm said in the survey: “China is the most important location for client origination for business in the next five years.”

Contributors to this story: Margot Williams


Favorite Tax Havens
The Caribbean British Virgin Islands are the preferred offshore destination for mainland China and Hong Kong residents, according to the Offshore Leaks data. For the Taiwanese, Samoa in the South Pacific is also popular.

 

[Scientific Playa]

more power moves !

The Russo-Chinese Pincer Movement Against The US Treasury and The FED
Posted on January 22, 2014 by horse237
The Federal Reserve Bank is privately owned by member banks. If those member banks have either sold out to China or are bought for pennies on the dollar by them when the dollar crashes, then Beijing will own the American Federal Reserve Bank. Though at that point we could no longer call it American.

China has bought 60% of all the real estate in the Financial District of South Manhattan. This includes the J P Morgan Chase headquarters building at one Chase Plaza which has the largest private gold bullion vault in the world. It is next door to the New York Federal Reserve vault. When Dr Jim Willie saw the price the Chinese paid for the building, he wondered if that was a typo. After he confirmed the price, he began speculating that J P Morgan might have lost a bundle and avoided bankruptcy by selling out to Beijing at a discounted price. He then began wondering whether or not the Chinese were taking over the Federal Reserve.

J P Morgan has so many tens of trillions of dollars in US Treasury interest rate futures that they are often called the operating arm of the US Treasury Department and the Federal Reserve. J P Morgan is certainly above the law. When Jamie Dimon at Morgan ordered Jon Corzine of M F Global to send them $1.2 billion dollars from allocated customer accounts, the two men broke laws that only apply to commoners. Corzine and Dimon have not been indicted for their crimes.

J P Morgan began in England as a Rothschild front group. It merged with the Chase Manhattan Bank which had been founded by the Rockefellers who also have been fronts for the Rothschilds since the 19th century.

Morgan has reversed its position on gold. It has been behind the SLV ETF (Exchange Traded Fund) as HSBC was behind the GLD ETF. These funds are scams that let the punters buy paper gold and silver while the US Federal Reserve, the Bank of England and other Central Banks sold gold into the markets to drive down the price of gold and prop up their near worthless currencies. Morgan and other banks had been aggressively shorting silver and gold to drive prices down. China and other Asian countries have been buying all the gold. Currently, there are few gold bars for delivery available in London, Dubai or New York. In fact some of the gold delivered to Germany had markings from older holdings which indicate there is not much left. France invaded Mali, a gold producer, after Germany demanded return of their gold. The US and England took Libya’s gold just before they returned Venezuela’s gold. The US is currently backing a UN offensive in the Democratic Republic of the Congo which has gold fields. And the US is ferrying troops from Rwanda into the Central African Republic which has three different gold fields under feasibility study by Canadian and European firms. But to date the US has only returned 5 tonnes of Germany’s gold.

J P Morgan has just recently switched their positions in the futures market and are now long gold. This means they are betting that gold will go much higher in the near future. I recently wrote that the Arabs are having their 99.95% pure 100 and 400 ounce gold bars being recast into 99.999% pure kilogram size bars so they can join in the new Chinese backed trade system. The Chinese system is based on kilogram gold bullion bars being converted into the yuan and possibly the ruble. This will replace the dollar in international trade. It is part of the Currency Reset. Gold will be priced at $7,000 an ounce and Americans who want to buy something from overseas will first have to buy a kilogram of gold. That would be $7,000 times 35.274 for one kilo. Perhaps Morgan has been listening to China. Many observers agree with me that Morgan and the Central Banks have the cooperation of China to manipulate the price of gold and silver while Asia acquires our precious metals at bargain basement prices. That will come to an abrupt end when the West has no gold to sell to Asia and US dollar is replaced by a gold backed yuan and ruble in international trade.

Dr Willie noted that Russia and China are making other aggressive moves.

China is buying industrial Enterprise zones. They are also buying US houses in large quantities. US Hedge Funds are buying homes which they hope to market as stock securities. It is easier to sell stocks than homes which is a lesson learned in the last housing crash. The US Federal Reserve is participating in this new housing Bubble. Moodys which has never seen a Bubble it did not like has rated these new investments AAA. Moodys is owned by Warren Buffett. China plans on becoming one of America’s largest employers and its biggest landlord after it takes over the properties owned by the Federal Reserve, the Too Big To Jail Banks and the Hedge Funds. The dollar could collapse so fast that Wall Street will not be able to unload their Bubble priced homes. China could easily pick up ten million houses. This means America would become a Chinese colony if a formidable resistance does not begin in the very near future.

When the yuan replaces the dollar as the international reserve currency, foreigners will dump dollars. The repatriation of overseas dollars and US Treasury bonds will double prices in dollars and cut the purchasing power of American pensions and paychecks in half. At that point, the Chinese could take the idle US manufacturing plants they are buying and open them. American wages would be cut low enough so as to make those Chinese-American companies competitive to low wage producers all over the world.

Russia is backing Iran and Syria. Iran has proposed a natural gas pipeline to send their gas to Syria which Gazprom, the Russian Energy giant, wants to sell to Europe for rubles. There are ongoing negotiations between the Iranians and the West called the P5 + 1 talks. P5 + 1 refers to the 5 permanent members of the UN Security Council plus Germany. The talks and the Iran sanctions have nothing to do with the Iranian nuclear weapons program because there is none.

Dr Jim Willie calls the P5 + 1 talks the Petrodollar Death Summit. The Petrodollar was created by Henry Kissinger after the 1973 Arab-Israeli war. The US had stopped convertibility of the dollar to gold in 1971 because their country was overpopulated had too many troops overseas. After 1973 the Arabs sold oil for dollars which they invested in US Treasury bonds and the New York Stock Exchange as did the then growing drug cartels. This meant US policy since 1973, if not before, has been committed to maintaining a high price for oil and to losing the war against drugs.

A pincer movement occurs when an opposing army flanks you on your left and on your right, overruns your position and cuts off your supplies from the rear.

The Chinese have recently had a Strategic Partnership Initiative with Saudi Arabia and three other Gulf nations. This is why you have seen articles in the New York Times denouncing the Saudis as terrorists. Dr Jim Willie has a source who told him that China and Russia are using Iran and Dubai to pressure the Saudis to transition from a Petrodollar to a Petro-Yuan. This would result in crashing the dollar and causing Nationwide Food Riots. It would also force the Saudis and the other Arabs to sell off hundreds of billions in US stocks and Treasury bonds. This would result in a bloodbath in the New York markets and devastate what would be left of American pensions.

China in 2013 bought Goldman Sachs’ aluminum and industrial metals warehouses. A Russian conglomerate bought the Morgan Stanley Energy Desk. You might remember Matt Taibbi of Rolling Stone saying a few years ago that Goldman Sachs and Morgan Stanley were buying and selling every barrel of oil 28 times before it got to market so they could drive the prices to obscene levels.

All that power to set prices for commodities, oil, natural gas and precious metals has now gone into Russian and Chinese hands. After the banks fail, China could buy their stock and quite literally own the US Federal Reserve Bank. Can you now clearly see the Russo-Chinese pincer movement out flanking the US dollar, the Treasury Department and the Federal Reserve?

 

[Scientific Playa]

Erik Prince of Blackwater infamy rented mercenaries to the US government in the Mideast. These men were accused of war crimes and human trafficking. Blackwater also paid $42 million dollars in fines to avoid arrest for breaking hundreds of US export rules. Erik Prince is now providing logistics and security services to China in Africa. China in 2010 had a Beijing African conference in which they pledged $100 billion dollars in investments. Obama and Hillary have countered the offer with all the drones the Africans could possibly want and more. The US had troops active in 134 nations last year. Drones and 25,000 Special Ops soldiers cannot counteract the rising tide of the yuan and the ruble.

I do not want to leave you thinking there is no hope for the future. The Good News is that we are headed into a Global Depression. That means we have an excellent opportunity for a Global Insurrection against the Bankers. The people of China do not like their government any more than the people of America and Europe like theirs. We need to emphasize Worldwide Debt Cancellation. We need to explain to people that we got into this Depression because we let bankers create our money as a loan at interest on money they created out of nothing. We must outlaw fractional reserve banking. And we must issue a non-interest bearing currency like President Lincoln’s Greenback
http://vidrebel.wordpress.com/2014/...movement-against-the-us-treasury-and-the-fed/

 

[无名的]

I said it on years ago and eventually it will come to fruition... there will be a revolution in China. I don't know when, but unless China fully transitions to some form of democracy and completely embraces capitalism, where people think wealth concentrated at the top is good in a game of winners and losers, the Commies will be in deep shyt one day and I CAN'T WAIT.



I used to walk in front of those piece of shyt red banners in China that touted the virtues of socialist economic harmony at construction sites where migrant workers slaved away on dangerous jobs for almost nothing, while people drove by in their BMW's.

 

[ADevilYouKhow]

nice read

 

[Blackking]

We have gross wealth gaps here as well. People with Billions... and people with no bank accounts. People who don't know when their next meal is coming and people with millions in offshore accounts.

I thought you couldn't build individual wealth and prosperity unless you lived under Western Ideas and versions of Capitalism.
I guess that's not true at all.

 

[tmonster]

modern cannibalism

 

[Mr. Somebody]

The hair is comb backed and slicked. Gangsters.

 

[newworldafro]

"people's republic of offshore" ....