Monday, September 28, 2015

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S3A: "Global Debt Forgiveness Activated"




This will pave the way for the exclusion of the fiat dollar from the global financial system in the coming days.

US Approves Yuan SDR Inclusion after China Orders 300 Boeing Planes
September 27, 2015

After reassuring the United States that its economy will be propped up by China, Obama has given his thumbs up to the inclusion of Renminbi into the IMF’s SDR basket of currencies.

Renminbi is the official “people’s currency” of China; Yuan is the primary unit of that currency.

This will pave the way for the exclusion of the fiat dollar from the global financial system in the coming days.

Of course, there are other covert arrangements which led us to conclude that the East is only really aiming for a peaceful “win-win” resolution of all conflicts with the West, and that the best they, i.e. the Reformists, could do for the time being is to initiate an “all-inclusive economic system”, and it is up to us to exploit and maximize that scenario where “no one is left behind.”

Earlier, the White House was also trying to raise the stakes using the cybersecurity and hacking issue which both countries are guilty of doing, and to which China has effectively downplayed by talking to the tech companies first before with anybody else.
After extended bargaining, both parties have reached an understanding on cybertheft issue, among others.

U.S. Takes Step Toward Support for China’s Reserve-Currency Bid
Andrew Mayeda

The Obama administration took a step toward backing China’s bid to have the yuan recognized as a global reserve currency, as the U.S. softened its insistence that the Chinese implement financial reforms to win support.

The International Monetary Fund is reviewing whether the yuan should be included in its Special Drawing Rights, a basket of reserve currencies used by the lender as a unit of account. After U.S. President Barack Obama and Chinese President Xi Jinping met Friday in Washington, the two sides issued a statement saying the U.S. supports the inclusion of the yuan “provided the currency meets the IMF’s existing criteria in its SDR review,” a point Xi highlighted in his press conference with Obama.

The shift in the U.S. position follows the administration’s failed attempt to prevent allies from joining the China-led Asian Infrastructure Investment Bank earlier this year, a strategy that was faulted by former policy makers including ex-Treasury Secretary Henry Paulson.
In June, a joint statement by the two countries said the U.S. “supports China making the reforms that would lead to the inclusion” of the yuan in the basket. Friday’s statement mentions U.S. support for “China’s commitment to implement further financial and capital market reforms.”

The new language clarified to the Chinese that the IMF’s assessment of whether the yuan meets the fund’s SDR criteria will be the determining factor for American support, said an administration official who asked not to be identified.

Winning the IMF’s endorsement would validate efforts by Xi to push through policies aimed at making the world’s second-biggest economy more market-oriented, boosting China’s prestige as it prepares to host Group of 20 gatherings next year. At least $1 trillion of global reserves will convert to Chinese assets if the yuan joins the IMF’s reserve basket, according to Standard Chartered Plc and AXA Investment Managers.

“The train delivering the SDR to President Xi in time for the November 2016 G-20 Summit in Hangzhou remains on schedule,” said David Loevinger, managing director of emerging-markets sovereign research at asset manager TCW Group Inc. in Los Angeles. There’s “plenty of wiggle room” within the IMF criteria to allow China to meet the fund’s requirements, said Loevinger, a former senior coordinator of China affairs at the U.S. Treasury.

The IMF’s executive board will make a decision on the yuan reserve-currency issue as soon as November. Approval requires 70 percent of the fund’s voting shares, and even if the U.S. opposed the move, the nation would need several allies because the U.S. has about 17 percent of votes. Many analysts have been predicting approval.

The U.S. and China also look forward to continuing to discuss methods to facilitate yuan trading and clearing in the U.S., according to the joint statement.

U.S. Treasury Secretary Jacob J. Lew in previous comments this year has put the onus on China to prove the yuan belongs, saying the country needs to further liberalize its currency policy and complete financial reforms before it can get the IMF’s nod.

Friday’s shift brings the U.S. closer to the positions of the U.K. and France. In a speech Tuesday in Shanghai, U.K. Chancellor of the Exchequer George Osborne said he’d like to see the yuan added to the IMF basket as the currency becomes increasingly important in global markets and “meets existing IMF criteria.”

French Finance Minister Michel Sapin said last week in Beijing that France favors including the yuan in the SDR basket, though China still needs to meet the IMF’s technical requirements first, according to Francois Coen, Sapin’s spokesman.