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Jim Willie: What Will It Mean If the Yuan Gets Reserve-Currency Status?

Tuesday, October 27, 2015 8:15
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(Before It's News)



In the second video below, Jim Willie begins by saying he sincerely believes the Dollar is about to be rejected on the world stage in the very near future. He says things are FAR more out of control than most people realize. (Uh, really? You think?)

Of the U.S. European“allies,” Germany is arguably the one the U.S. can least afford to lose right now economically, because they’ve been the ones propping up the European Union, and keeping it from collapsing. Like most of our “allies” in Europe, Germany is SICK of the United States. From the failed (cough, nonexistent, cough) U.S. Middle East policy causing Germany to be overrun with refugees, to the Iranian deal, to Obama’s NSA listening in on Merkel’s phone calls, it’s understandable why German and our “allies” have HAD it with the United States. Obama has repeatedly spit in their faces, and now the “chickens are coming home to roost,” as Obama mentor Jeremiah Wright once famously said. 

Germany is also sick of the European Central Bank. Presumably because of what happened in the Weimar Republic as a result of their monetary policy (not unlike the current U.S. monetary policy) and the hyperinflation that resulted and eventually led to Hitler’s rise, Germany has become the fiscally responsible rock of Europe, and they have HAD it with U.S. and our suicidal monetary policy. Jim says to expect an announcement from them in the near future that Germany is departing from their use of the Dollar in trade. Germany is just one of many nations that realizes it has NO economic future with the United States, or the U.S. Dollar. Their future is with the Eurasian Trade Zone and by maintaining excellent trade ties with Russia and China. That can only happen with some type of “currency reform,” a euphemism for abandoning the Dollar. Any argument for maintaining good relations with the United States for a military future will evaporate at the same time the Dollar does. 

As has been previously mentioned, the abandoning of the U.S. Dollar as the World Reserve Currency is not something the world takes a vote on, or is some big event, but rather it’s a process, and it’s one that has been WELL underway for years. How long do people expect the U.S. Dollar to last before it collapses when many of the world’s other large powers are fleeing from the U.S. Dollar including U.N. Security Council members like Russia, China, France has threatened, and now Germany too? 


For people asking why they should care about the U.S. Reserve Currency status, let me make it very simple: When major powers like Japan, India, South Korea, Australia, and others on every continent begin trading with one another and the trades no longer are denominated in U.S. Dollars, then there is no need for those nations to have U.S. Treasure Bonds in their national reserves. As one would rationally expect, if those nations no longer need U.S. Treasuries, they’ll begin to dump them. That’s when the curtain comes down for good on the American Empire. U.S. Treasuries are like any other commodity on earth whether it’s oil, money, or pork bellies. To simplify things for the sake of example, if their was a food crisis, and you were the only one on your street with food, imagine how valuable that food would be, right? Now imagine if the supply of food was so plentiful that it was taking up space in everyone’s homes to the point they looked like the hoarding shows you see on television. If your neighbors could not get rid of the food THEY had fast enough for their own needs, do you think that offering them your food in exchange for something would work? NO! 

Let’s tie it all together now: Because of our of obnoxious monetary policy for decades, the U.S. now runs a trade deficit of over $500 BILLION annually. Peter Schiff discusses the INSANITY of the double speak coming from government regarding the deficit below: 



The only reason the U.S. is able to run these insane trade deficits (aka charge a credit card) is because the countries we trade with have been willing to take U.S. Dollars. Not IF, but WHEN the U.S. inevitably looses the Reserve Status, and our credit card is essentially cut up, prices on foreign goods (aka the only good Americans want) will SKYROCKET, and once again, the man who doubled the country’s national debt since it’s founding in seven short years will have PUMMELED those he claimed to be helping the most: All the imbeciles that bought into Obama’s rhetoric.  

Germans gullible idiots when it comes to Obama’s rhetoric like Americans are. Germans realize that the deal Obama is offering them in exchange for not purchasing energy from the Russians is a TOTAL SHAM! As Jim explains, Germany knows Obama is blowing hot air about being able to deliver energy because Germany knows that in March, U.S. mercenaries, with hoods on their heads and at 2am, stole 44 tons of Gold from the Borispol Airport in Kiev along with $70 BILLION DOLLARS of the prime minister’s money (allegedly for “his own good” and safekeeping) and deposited the money in a Swiss Account. The U.S. has been on a gold stealing RAMPAGE, and even though the U.S. Mainstream “News” won’t report it, because they are Obama lapdogs, that doesn’t mean it isn’t happening, and it doesn’t mean Germany doesn’t know. They KNOW the U.S. is BROKE and very desperate. In a post titled: Jim Willie: The Mid East Carnage Left by the American Wrecking Ball, it says:

The U.S. has managed to dislodge virtually all the monarchies in the Middle East, created MASSIVE instability, STOLEN everyone’s gold, and right now all our “allies” are scurrying to get as much of their gold from central banks as possible thanks to U.S. THEFT! Relations have deteriorated so badly in the Middle East, that when Obama went to Saudi Arabia this past spring, they ignored him. They literally would not speak to him. Along with the rest of the world, the Mid East has HAD it with the U.S.

The West in general has lost ALL credibility with everyone in the world, with one exception: The IMBECILES still supporting the Liberal/Communist/New World Order Lapdog Obama regime here in the United States. The clock is ticking, and the economic time bomb that goes off when the clock strikes zeros is going to be biblical it will be so bad. You have time to prepare, even if only modestly. Do it for your family. 

I’ve only summed up the first half… In the video below Jim Willie has has PLENTY more to say, so I suggest listening to what he offers, then read the article from Bloomberg after to further your understanding of how bad things get for the U.S. when the Yuan takes the Dollar’s position as the World Reserve Currency.  




Bloomberg writes:

International Monetary Fund representatives have given China strong signals that the Yuan is likely to soon join the fund’s basket of reserve currencies, known as Special Drawing Rights, Chinese officials with knowledge of the matter told Bloomberg News this week. Here’s a primer on what that means.

What is a Special Drawing Right?

The fund created the SDR in 1969 to boost global liquidity as the Bretton Woods system of fixed exchange rates unraveled. While the SDR is not technically a currency, it gives IMF member countries who hold it the right to obtain any of the currencies in the basket — currently the dollar, euro, yen and pound — to meet balance-of-payments needs. So the ability to convert SDRs into yuan on demand is crucial. Its value is currently based on weighted rates for the four currencies.




How much of these SDRs are out there?

The equivalent of about $280 billion in SDRs were created and allocated to IMF members as of September, compared with about $11.3 trillion in global reserve assets. The U.S. reported about $50 billion in SDR holdings as of August.

Why does China want this status so badly?

In a 2009 speech, People’s Bank of China Governor Zhou Xiaochuan said the global financial crisis underscored the risks of a global monetary system that relies on national reserve currencies. While not mentioning the yuan by name, Zhou argued that the SDR should take on the role of a “super-sovereign reserve currency,” with its basket expanded to include currencies of all major economies.

Chinese officials have since been more explicit. After meeting President Barack Obama last month at the White House, President Xi Jinping thanked the U.S. for its conditional support for the yuan joining the SDR. Winning the IMF’s endorsement would allow reformers within the Chinese government to argue that the country’s shift toward a more market-based economy is bearing fruit.

Why is the IMF likely to approve this?

Global use of the yuan has surged since the IMF rejected SDR inclusion in the last review in 2010. By one measure, the currency became the fourth most-used in global payments with a 2.79 percent share in August, surpassing the yen, according to the Society for Worldwide Interbank Financial Telecommunication, known as Swift.

The IMF uses several indicators to determine if a currency is “freely usable,” the benchmark for inclusion in the SDR basket. IMF staff members said in a report in August that the yuan trails its global counterparts in major benchmarks, such as its use in official reserves, debt holdings and currency trading. But staffers have also stressed that the fund’s 24 executive directors, who will make the final call, will need to use their judgment.

Many major economies, including the U.S., Germany and U.K., say they’re prepared to back the yuan’s inclusion if it meets the IMF criteria. Supporting the yuan may boost relations between China and countries such as the U.K., which has sought to make London a major yuan trading hub.

Adding the yuan to the basket may also help the IMF improve its standing with the Chinese. China and other emerging markets were supposed to gain greater representation at the fund under reforms agreed to in 2010, but the U.S. Congress has yet to ratify the changes.

What’s likely to happen to yuan assets in the longer term?

At least $1 trillion of global reserves will migrate to Chinese assets if the yuan joins the IMF’s reserve basket, according to Standard Chartered Plc and AXA Investment Managers.

Foreign companies’ issuance of yuan-denominated securities in China, known as panda bonds, could exceed $50 billion in the next five years, according to the World Bank’s International Finance Corp.

“Once the Chinese yuan becomes part of the SDR, central-bank reserve managers and institutional investors will automatically want to accumulate yuan-denominated assets,” Hua Jingdong, vice president and treasurer at IFC, said in an interview in Lima earlier this month during the IMF and World Bank annual meetings. “It will be strategically important for China to welcome all kinds of issuers to become regular issuers in China’s onshore market.”



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Total 4 comments
  • It will mean pictures of Chinamen on our money.

  • The meek will inherit what the proud stole…..the earth :cool:

  • THe worst part about this is all the Americans who understand what is going on wil suffer. Not their fault, pretty sad. Nothing they can do either. When a REAL collapse of the US happens, farms will be pillaged, houses looted, it will be chaos. There is little to no preparation that could save any individual, save for a steel bunker miles in the ground with full self sufficiency.

    Which is why DUMBs exist. The rich know that, and are plenty willing to let us all die when the time comes, and there is nothing the ones who are aware can do.

  • when usd collaspse, what does euro do?
    same thing?

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