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Notes:
(1) Total Chinese foreign exchange reserves amount to USD
2,000-billion, of which USD-denominated assets are 70 percent maximum,
equal to USD 1,400 billion. The remaining 30 percent mainly consists of
EUR-denominated assets.
(2) Most of the time, the same «
experts » predicted that global economy would benefit from banking
deregulation, that the Internet economy was opening up an era of
endless growth, that US deficits were a sign of strength, that US house
prices would always go up, and that taking on debt was the modern way
to get rich.
(3) The message on the necessity to
switch international reserve currency, sent out by Beijing to the world
– to US authorities in particular –, on the eve of London’s G20 Summit,
was not intended to merely test the waters nor was it some vague
attempt with no hope of success. The Chinese leaders had no illusion on
the chances for this topic to be actually addressed in the G20 Summit,
but they wanted it to be discussed in the backrooms, because they
wanted to send an unofficial signal to all the players of the
international monetary system: in Beijing’s mind, the Dollar system is
over! If no one wishes to prepare for a common alternative system, the
alternative system will be built some other way, knowing that the
actions the Chinese are currently taking corroborate this intention.
For instance, precisely these days (random political schedule is rare
in Beijing) a book is being published, entitled « Unhappy China »,
arguing that Chinese leaders should stand up and impose their choices
on the international arena. Source: ChinaDailyBBS, 03/27/2009
(4) This link gives the figures to the last cent: ChineInformation.
(5) Angela Merkel was closest to the truth about the G20 summit when she called it « an almost historical event
». The word “almost” is emblematic of what happened in London: the G20
leaders “almost” created a framework for a joint action programme, they
“almost” launched new stimulus plans and new international financial
rules, they “almost” banned tax-havens, and they “almost” convinced
everyone that it would happen. “Almost” but not “really”, will make a
big difference for the next stages of the crisis.
(6) In the previous issue of the GEAB
(N°33), our team explained this dilemma for the “international system”
today. At some point, it is in the interests of new players to simply
wait for the current system to break down in order to build a new one,
rather than strive to reform it, and suffer a long period of
uncertainty.
(7) In particular, outrageous government borrowing - also called « economic stimulus » in Washington and London.
(8) The decisions taken at London’s G20 summit directly contribute to the long-term crisis scenario.
(9) As regards the EU, LEAP/E2020 emphasizes the inanity of all those
economic and political « analyses », produced by leading economists and
experts close to the American Democrats, and circulated by all the
largest international mainstream media, blaming the Europeans for not
following in Washington’s footsteps. Paul Krugman in mind for instance,
these « very good friends » of Europe, who like it so much that they
think they know better than Europe what is best for it (and what it
should become, as indeed the same experts usually advocate its
extension to Turkey, see Israel and Central Asia), whereas they would
be best giving some quality advice to their own party and their new
President to prevent their own country from collapsing, as this is what
is really at stake today. It is beyond belief that a panel of experts,
who, in all these years, sang the praises of a system which is today
collapsing under everyone’s nose, still dares give lessons to the rest
of the world. Basis decency suggests only one course of conduct
worldwide: silence. In Europe, this position, despite the fact that it
still enjoys its usual academic and media support, is too outdated to
be accepted. LEAP/E2020 believes it is necessary and legitimate to cast
a critical eye on the EU, its leaders and its policies; but doing so on
the sole criteria of its conformity or otherwise with Washington’s (or
London’s) stance is no longer acceptable. In the same way as financiers
and business leaders obviously failed to understand that times had
changed regarding their stock-options and “golden parachutes”, a number
of intellectuals and politicians have not yet fully understood that
their points of reference, values and theories now belong to the past.
They should think of the elites of the Soviet bloc and they would
understand how and how fast a thought system can become obsolete.
(10) Besides collapsing tax revenues,
a protest movement has started in the US against using taxes to save
Wall Street and against further deficits, blaming the country’s entire
leading class. Sources: USAToday, 04/13/2009; MarketWatch, 04/16/2009
(11) Sources: USAToday, 04/11/2009; MarketWatch, 04/10/2009
(12) In California for instance, the first days of April suggested
revenues far lesser than the worse forecasts, likely to result in
multiplying two-fold California’s debt anticipated a few months ago. A
similar trend is under way at the federal level, making it possible to
imagine that the annual federal deficit reaches above USD 3,500
billion, i.e. 20 percent of US GDP. Source : CaliforniaCapitol, 04/08/2009
(13) Some towns, like Auburn near Seattle for instance, are compelled
to ban trucks from their major freight routes by lack of maintenance
financial means. Source: SeattleBusinessJournal, 04/10/2009
(14)Thus enabling to anticipate upcoming trends.