Is There More to The Invasion of Ukraine?

Opinion Only

by Steven J. Spence

Perhaps there is more than just an invasion. I propose that there is an attack on the world reserve currency. From the viewpoint of Russian leadership, a global superpower nation, weakness will stem from a poor economy, or better yet, an economy controlled by an outside nation. And, this outside nation has the power to sanction or economically punish any nation it wishes. Why would you, as a Russian leader not do anything about this? Also, by extension, an attack on the world reserve currency would be an attack on the USA and even the EU without a kinetic war.

The Russians have been making some moves that seem to me to be pre-positioning of their financial troops if you will. As I write this op-ed, it should be obvious that we are all victims of a propaganda campaign that have once again divided the world to anti-Russian versus pro-Russian. They call this the ‘fog of war’. The hatred toward one another has gotten so bad that my relative in Germany just reported that a German patient will not accept a life saving blood transfusion from a Russian because of the nationality and this hatred was supported by the doctor!

This blog is not an attempt to guide you to pick a side in any of this, but more importantly, I want you to see the magician’s trick and the sleight of hand as I am noticing something else unfolding that will affect all of us (anyone who uses any currency or fiat money). After all, there are three sides to a coin, right? Can I take you to the edge of the coin and take a look for few minutes?

I want to preface with this first; I have served in the US Air Force for 22 years and have seen some of the horrors of war. I have been part of bringing home the remains of soldiers more than I ever cared to be part of and yet I was honored to be part of every one of their last journey home. But this does not include the death and destruction of the civilian side of these wars. I cannot imagine anyone going through what these people have gone though.

I am a “Plain and Simple” person, so I am only going to provide a 40,000-foot view of this. If you want to know more, the information is out there. Let me point your nose into the wind (pilot talk) to highlight their actions and you can look into these topics for yourself.

In my book; “Money, Plain and Simple, What the Institutions and the Elite Don’t Want You to Know”, I wrote this in chapter 4, titled “World Reserve Currency”:

“Wealth is power, and, unfortunately, he who controls the money controls the world. Unfortunately, we still live in a world that has people who seek dominion overall. And currently, there are the two countries that can now rival the United States. Oh, who do I think they are? If you guessed them to be the Russian Federation and the People’s Republic of China, you would be correct. Both countries have been seeking ways to trade with other nations without the use of the U.S. dollar. Additionally, they have been really focused on procuring and stockpiling gold for many years now and establishing their own currency that would be backed by their own gold. The strategy in this would be to use currency that is backed by an asset, whereas the U.S. dollar is fiat. It would be attractive for nations to have a stable currency backing their own.”

As I re-read this quote, ‘dominion overall’ may be an over-statement. Perhaps sovereignty over themselves could be fitting as well. We shall see, but either way, it means a destruction of the global monetary system as we know it.

I started this blog with a bunch of facts and began to ‘geek’ out a little bit over the data. I didn’t want to bore you so this is a re-write. I want to make this a short and concise as possiple, the Plain and Simple way.

Many will assume that the US is the wealthiest nation in the world. You, like me, disagree with this statement as we know that we are the most indebted nation in the world. And we know, debt is not wealth. So how did we get this prestigious title? Smoke and mirrors using Treasury Bonds and Fiat Currency. The fiat is only possible because of the Petro dollar agreements the US holds with the nations of OPEC. Okay, now we have energy involved with this blog.

What are other instances that weaken a nation? How about debt to GDP ratio? Energy policies? Monetary policies that lead to high inflation? Conversely, a nation can be strengthened when focusing on these financial disciplines and becoming fiscally independent. Where are we in the world today?

Let’s start with Russia, what have they been up to? Russia appointed Elvira Nabiullina in 2013 as the Chairwoman of the Russia Central Bank. Her appointment and the Russian leadership have been leading the nation to a more independent financial position for the Russian economy. Some items to note are:

  1. In 2018, Russia dumped 84% of holdings of US Treasury bonds ($81 billion).
  2. Russia has been aggressively building up the gold reserves and are currently the 5th largest holder in the world.
  3. Russia has been aggressively paying down their debt and are enjoying a very low debt to GDP ratio of 18%.
  4. Russia has a trade surplus of over $26 billion in 2021, an increase over 2020 by 42%.
  5. Russia has just removed VAT (Value Added Tax) levied on gold bullion for its citizens, this is thought to encourage private ownership by reducing the price 20%.
  6. Russia is issuing Executive Orders regarding the USA as undertaking hostile actions towards the Federation. These EOs are limiting and/or blocking exports to other countries that have joined the USA.
  7. Russia signs a military pact with Saudi Arabia in August, 2021.

Now, as I stated in my book, the Russians and the Chinese do not want to be controlled by the USA, especially in the form of sanctions. From their viewpoint, they see that they are not sovereign if another nation has this financial tool to use against them. The west will use sanctions as a diplomatic tool that is used via the US dollar system to punish nations that are out of line as determined by other governments (mainly the US and Europe). So, the question is, how do they get out from under the dollar that controls them? The obvious answer is, to seize the world reserve currency position from the USA. This is the simple answer, but it will take time to re-position an entire nation to weaken the current system and even become the global reserve currency. This is a massive accomplishment.

Can it be done? I don’t know, and I do not believe this has ever been tried before, but it appears to me that there is a very strong possibility of this happening right before our eyes. I mean with the Russians at the moment. I suspect that the Chinese are also preparing something, but nothing is on the global stage as of yet. I have presented some of their actions, so the other part is the weakening the world reserve currency, that is the USA and the US dollar. Remember, he who has the gold makes the rules. It seems that gold and a currency that is backed by it will be the common denominator for the coming dollar break away.

My book Money Plain and Simple spells out that there is this modern money theory that is a debt-based system to create currency. And this is a workable system providing that the governing body of the currency restricts themselves from abusing it. It saddens me that my country, the United States of America has chosen the abusive and self-destructing path. Here are some of the items that weaken a nation and weaken the currency.

  1. Burdensome debt; the US has recently passed the $30 trillion mark. And crisis occurs after crisis that calls for more spending. We must acknowledge that more spending is more borrowing first.
  2. More borrowing leads to more currency creation. More currency creation leads to higher inflation. The US is experiencing month after month 40 year record inflation highs.
  3. To combat inflation, two obvious actions the Federal Reserve has to do, one is move from Quantitative Easing (QE) to Quantitative Tightening (QT). It seems that is not possible as there is a repetitive crisis requiring currency. Then there is the increasing of interest rates. The Fed is planning to begin raising rates this month (March 2022), by 25 basis points (0.25%). Did you know that 1 basis point increase equals to $3 billion in debt servicing? That is an additional $75 billion expense to combat inflation at the current debt level.
  4. The debt to gdp ratio is over 126%. Recall that over 77% is on a path of an economic growth slow down.
  5. The USA has consistently reported a trade deficit. In 2021 the deficit is the largest in the world of $859 billion. The US consumes more than it produces.
  6. The USA is imposing economic sanctions on Russia and banning purchasing of Russian exports, to include oil.

To put a bow around this, the US is continually spending thus weakening the dollar. There are no obvious concerns by congress to address this. They only seem to look for more ways to borrow and spend. At the same time, the US imposes sanctions on other nations for reasons that are not in their interests.

For a nation to be strong, their economy must be strong first. I see the Russians have been rebuilding their economy (as well as the Chinese) for at least the last decade. They are playing a long game. I can assure you that they ‘table topped exercised’ this entire conflict and have prepared themselves to endure this invasion. I would expect that they knew sanctions would be imposed upon them. Additionally, I also expect that they have made trade deals for oil and other raw exports to Brazil, India, China and South Africa. This is called “BRICS” and these five nations encompass over 26% of the world’s land and 41% of the world’s population. Don’t forget the agreement signed a military pact with Saudi Arabia. Didn’t the US provide military support for them as part of OPEC? Isn’t that a crucial piece to the strength of the Petro dollar?

In the book, I explain the importance of the Petro dollar and how it allows the Federal Reserve and the USA print currency. What happens if the US allows that to be taken down? The dollar would surely collapse and debts of the US governments can not be paid.

What would happen if the Russians exported oil to their friends and was paid in gold? What if the Russians were able to create a gold backed world reserve currency? What would happen if gold prices were no longer suppressed and is able to go to its true value? Would that add to their economic power? Only a week ago, the Fed Chairman stated that it is possible to have more than one reserve currency in the world. Do they already know what is coming?

The world is waking up to the dollar abuses, and are beginning to see that they serve the US while the US mostly consumes. The US was given this great power to create money out of nothing and now it seems that the US is the bully of the world…as seen by all of the other nations. There is a saying: “Absolute power corrupts absolutely”. If the US doesn’t get a grip on what we are doing, we will lose it all. Only a week ago, the Fed Chairman stated that it is possible to have more than one reserve currency in the world. Do they already know what is coming?

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