March 15th, 2014

Kremlin: If The US Tries To Hurt Russia’s Economy, Russia Will Target The Dollar


economic warfare

If the US and NATO Countries impose economic sanctions on Russia, they are playing with fire. The only thing keeping the US economy afloat is the dollar’s status as the world’s Reserve Currency.  – Shorty Dawkins, Associate Editor

This article comes to us from testosteronepit.com

Another warning shot was fired before an all-out assault on the dollar system begins. This time, an official shot: Alexey Ulyukaev, Russia’s Minister of Economic Development and former Deputy Chairman of the Central Bank, fired it. It was a major escalation, Valentin Mândrăşescu, editor of The Voice of Russia’s Reality Check, told me from Moscow.

Last time, it was Sergei Glazyev, an advisor to Vladimir Putin who’d fired the shot. But he wasn’t a government official. “Anonymous sources” at the Kremlin claimed he wasn’t speaking for the government. As Mândrăşescu reported in his excellent article, From Now On, No Compromises Are Possible For Russia:

From the economic point of view, everyone should get ready for tough actions from Moscow. Sergei Glazyev, the most hardline of Putin’s advisors, sketched the retaliation strategy: Drop the dollar, sell US Treasuries, encourage Russian companies to default on their dollar-denominated debts, and create an alternative currency system (reference currency) with the BRICS and hydrocarbon producers like Venezuela and Iran.

Unlike radical-sounding Glazyev, Ulyukaev is part of Dmitry Medvedev’s Cabinet. And as former Deputy Chairman of the Bank of Russia, he doesn’t take currencies lightly. He told Rossia-24 news channel about possible retaliatory measures if Washington adds economic sanctions to the political sanctions. Moscow wouldn’t worry too much about political sanctions, he said, but if Washington tries to hurt Russia’s economy, Moscow would retaliate by targeting the US dollar.

Some of it is already happening

Washington’s decision to release a minuscule 5 million barrels of oil from the Strategic Petroleum Reserve caused the price of oil to tank – a direct attack on the main revenue source of the Russian government, and a sign that Washington is willing to hit where it hurts the most [read a trader’s lament.... Commodity Markets Will Be Used As A Weapon Against The Putin Regime, Starting Now].

Russia instantly retaliated, it seems. Suddenly, there was a mysterious mega-plunge of $104.5 billion in US Treasuries held in custody by the Federal Reserve during the reporting week ended March 12. It brought the balance down to $2.86 trillion. These securities are owned by foreign countries. As of the US Treasury’s December statement, the most recent available, the Fed held $138.6 billion in Treasuries that belonged to Russia – down by $22.9 billion from a year earlier. The mega-plunge of $104.5 billion? No data is available yet to confirm these securities belonged to Russia. And if they did, it’s unlikely that Russia dumped them on the market, but it could have transferred them to another banking center, such as Luxemburg, to get them out of reach of the US government, and be able to dump them at an opportune moment.

Getting out from under the dollar

Russia has been palavering with other countries about initiating alternatives to the dollar. Formal plans emerged from the Kremlin last May on how Russia wanted the BRICS to dismantle the dollar system. So now it was Ulyukaev, an official heavy-weight, who said that Russia would work on increasing the volume of international trade denominated in national currencies, thus bypassing the dollar (translation by Mândrăşescu):

“Why should we have dollar contracts with China, India, Turkey?” he said. “Why do we need this? We must have contracts in national currencies. And this applies to energy and other spheres.” The focus would be on Russian oil and gas companies. “They must be braver in signing contracts in rubles and the currencies of partner-countries,” he said. “I think now there is an additional impetus to finally finish this job.”

And the “currency reserve policy” would need some adjustment with maximum focus on “local currencies”; it was the normal way, he said. In Mândrăşescu’s analysis, Ulyukaev was outlining an attack on the petrodollar system and the enormous advantages it confers on the US, with the goal of creating parallel petro-currencies.

Media blackout in the US

The warning, issued officially and publicly by a Cabinet member, to target the dollar, has been vigorously ignored by the mainstream media in the US. It’s a touchy subject here. The dollar reigns supreme. Its status as the sole world reserve currency, which has provided the US with enormous economic advantages, remains unquestionable forevermore. Or so wishes the Fed, which has done such a wonderful job of managing the dollar for the last 100 years that it has lost most of its value, though it’s still a heck of a lot better than the ruble.

“I have a suspicion the Western media don’t want to report on this,” Mândrăşescu said. “It could be a bit unpleasant for the S&P 500 and the nanobots trading the US stock market.” Better keep them in the dark.

It took a while. But it had to come, the public warning shot – after some ferocious lobbying behind closed doors. No one in Germany is allowed to get in the way of the sacrosanct exporters. Read…. German Exporters Fire Warning Shot About Russia “Sanction-Spiral,” Banks At Risk




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4 Responses to “Kremlin: If The US Tries To Hurt Russia’s Economy, Russia Will Target The Dollar”

  1. 1
    Austrian Economics is Color Blind Says:

    The Federal Reserve Note is NOT a heck of a lot better than rubble. We are being forced to use paper as our money. They may as well be forcing us to use rubble.

    As much as possible, we need to stop using all paper money, and use commodity money:

    Ron Paul Calls the Housing Collapse in 2003
    http://www.youtube.com/watch?v=9S3lXDOQ7ec

    Ron Paul also called it in 2001:

    Ron Paul: “This real-estate bubble will burst, as all bubbles do” (part 3)
    http://www.youtube.com/watch?v=KONpt9a6HrI

    See also this:

    The Austrian School on Business Cycles: 100 Years of Being Right | Mark Thornton
    http://www.youtube.com/watch?v=HegiGuJlzTQ

  2. 2
    Churchill Says:

    Perhaps, the potential possibility of it being the trigger to have that of the NDAA and several previously passed executive orders enforced has been and is being currently being considered by some. Indeed, as for the NSA and the CIA, will they be consumed by the DHS? After all, the DHS intelligence is lacking lol, but their info is now rather well linked with INTERPOL as like within all branches and agencies within Federal and State Government and outside as well, not to mention many companies, corporations and including various small business’s, completely unlike the NSA and CIA. Knowing that the FBI has offices opened up in various foreign locations, including the Mid-East during the ‘War on Terror’, it can be assumed that the DHS fusion centers are more knowledgable than previously thought, possibly even in current Military affairs.

  3. 3
    noncomplier Says:

    Well seeing how it is absolutely none of our business really what ukraine or crimea or russia or Venezuela or syria or iran or iraq or any one else for that matter ,does. Our criminal out of control government is truly evil. It is becoming crystal clear that our federal and state governments are so criminal ,the whole world now can see just how obviously deceitful the politicians are. Not that american suits are alone in this devil worshipping ,their just the ones who are watched the most. Yes that’s right devil worshipping ,they are obviously in love with satan. How else can one explain what’s going on. Russia has every right to do as it will. American politicians are the the root of evil. I do not blame the filthy rich scum who run the world from behind the scenes,if these politicians and the non-human scum that work for them,were siply christian like we would have NO problems. That’s right ,treat others as you would like to be treated ,love one another and take care of eacother.these ideas do not enter washingtons minds. So simple really isn’t it,simply strive to be like christ,instead our government pays thugs to create chaos over n over. In every part of the world the example we set is love satan. Why is is this?

  4. 4
    Remember the Alamo Says:

    “If the US and NATO Countries impose economic sanctions on Russia, they are playing with
    fire. The only thing keeping the US economy afloat is the dollar’s status as the world’s
    Reserve Currency. – Shorty Dawkins, Associate Editor”

    –Not much of a life raft. Maybe I should learn how to swim.

    Then we have the printing presses at the Federal Reserve which
    don’t seem to be doing much of a job “lately” other than printing
    the dollar into complete worthlessness. But I forgot, the farce
    called “free” trade might come to the rescue and we can offshore
    some trillions more of American dollars via free trade deficits,
    along with what is left of American manufacturing.

    Speaking of rational thinking:

    http://buchanan.org/blog/putin-irrational-one-6292

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