G-20 summit (with Baby Bush, but without Obama) didn’t modified the dollar-centrism for the extinct Bretton Woods system and “starting from now until 2009 spring, the present bankruptcy of the system and the United States, which represents its core, will push the set of the planet to an unprecedented economic, social, political and strategic instability, marked mainly by the global monetary system break for 2009 spring.
In reference to the failed G-20 summit, held in Washington, the very solvent Europe 2020/GEAB (Nr. 29; 11.16.08) points “the end of the western monopoly, above all the Anglo-Saxon”. For Europeans such summits show the “inefficiency in the face of a crisis, since they just limit to treat the symptoms (bank financial derivatives and other hedge funds, external currency instability and financial markets, etc) without dealing with the root cause for the current global systematic crisis; this means, the collapse of the Bretton Woods system founded on the American dollar as a column for the global monetary building”.
It seems we have to “pass for this catastrophe in order to solve the root problems” and here we will point out the four fundamental phenomena that will collapse the system during 2009:
1. - Accelerated weakness of the historic main actors: USA and UK. It is to notice the coincidence.
2. - Three visions for the future of global governance will divide to the main global actors: (USA, Euro zone, China, Japan, Russia and Brazil) starting from 2009 spring”. It is easy to guess what these 3 visions consist as they are are: the anglosphere, continental Europe (from the recent strategic alliance between Russian and France in the Nice Summit) and China. It is to notice the absence of Indian and the lack of South American cosmogony (Latin America long ago stop to exist when it had been annihilated by the neoliberal jihadists)
3. - Unregulated acceleration of destabilizing processes inherited from the past decade.
4. – Growing multiplication of violence riots.
It is the very foundation of the building what is under menace of collapsing. In this first year of stock market corrections, the Dow Jones index has suffered its most violent collapse since 1900, even stronger than the one from 1929.
The global leadership has proven to offer poor solutions and we have to expect the renovation of at least 20% of the main global leaders to start viable solutions, otherwise it would be nearly impossible to face the fundamental changes. Financial deregulation turned mad the global political class and its pseudo-intellectuals.
We can predict the US debt implosion by the 2009 spring in a payments stop fashion of the country or the massive devaluation for the dollar. Similar episodes will affect to UK and the countries integrated to the US economy and finances.
The global reserves in dollars ascends to US$7.4 Trillion. China has nearly $2 Trillion, Japan nearly $1 Trillion, Europe $530 million and Russia $475.4 million.
The Financial Times has set the list of tangible assets of the US government (military bases, national parks, public buildings, museums, etc) valued at $1.5 Trillion equivalent to its next year budget deficit.
The People’s Daily (11.17.08) determines that “the world is not ready yet for a new global financial system” due to the “USA protects its interests” at all costs. When the global choir claims for the end of the dollar hegemony, the newspaper points the strong defense of the dollar by Japan as the “only viable currency reserve”. Since long ago, Japan became a franchise of the Anglosphere and its creating a great deal of trouble to the world.
China Daily (11.17.08) exposes the little advertised posture of the President Hu Jintao, who urged the establishment of a “new global financial order more egalitarian, fair, inclusive and organized” with the “gradual diversification of the many currencies”.
According to China Daily, “analysts” consider that “it could take a long time yet for the international financial system reform to materialize, despite some adjustments in the short term”. It seems that China has resigned to “USA, the greatest economy in the world, doesn’t lost its prominence in the short term, when the present international financial structure could stand for a while”, as Zhan Jun, director of the University of Fundan, declares.
It would be good that our Chinese friends get an update, since the European Union represents for now the greatest economic power in the world $16.9 Trillion ahead of the USA $13.8 Trillion, according to the IMF data.
Being more concrete, Zhao Xijun, finance professor at the University Renmin of China, argued that “the basic structure of the international financial regime will prevail without changes, but there will be some modifications in topics like more cooperation to regulate the markets”. He added that hedge funds and investment banks “have played doubtful roles at unleashing the current crisis, they will be forced to a bigger transparency”.
USA and UK will not accept any substantial modification to moribund system of Bretton Woods and before that they will prefer a “catastrophe” and/or a Third World War that the torturer Bush regime has vaunted. The price of the unavoidable reforms will be very high.