China holding Treasuries ‘nuclear option’ open in trade war with US

Beijing is by far the largest holder of US Treasury bills, meaning it can affect their price and yield. It could be China's trump card in the trade war with Donald Trump.

As of January 2018, China held $1.168 trillion in American debt, more than a $100 billion increase since the same time last year, but down about 11 percent from the record high above $1.3 trillion in late 2013. That's 19 percent of all US Treasuries, notes, and bonds held by foreign countries.

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Beijing increased its holdings of US debt last year by the most since 2010. China’s foreign exchange reserves were about $3.13 trillion at the end of February, with roughly a third of them held in US Treasuries.

However, if China seeks to manipulate the United States in a trade war, it would be well advised not to sell them, analysts say.“If they wanted to pull the nuclear switch, if they committed to dumping Treasuries, it would have an immediate and temporary impact on money markets in the United States,” said Jeff Klingelhofer, a portfolio manager who oversees more than $6 billion at Thornburg Investment Management, as quoted by Reuters. “But I think it is a bigger hit to the sustainability of what they’re trying to accomplish.”

Jeffrey Gundlach, the chief executive of DoubleLine Capital LP, agrees, saying that US Treasuries can be used by China as a leverage. “It is more effective as a threat. If they sell, they have no threat. It would only escalate the situation and eliminate their leverage,” he told the news agency.

Chinese officials said in January that the government is considering slowing or halting purchases of US Treasuries as they have become less attractive relative to other assets.

Some analysts have said that by buying US Treasuries over the years, China has artificially depreciated its currency. A weaker yuan makes Chinese exports cheaper for buyers, and thus boosts trade.


(RT)

Campaign urges Israel soldiers to refuse to shoot unarmed Palestinians

By AFP

Written by Darius Shahtahmasebi

(ANTIMEDIA) — Countries that don’t eagerly follow the U.S.-led global order make prime targets for American-led invasions, particularly when those countries challenge the status of the U.S. dollar.

Right now, Venezuela is one of these countries. Venezuela sits on the world’s largest oil reserves, and in order to free itself from what it calls the “tyranny of the U.S. dollar” in maximizing its potential on these oil reserves, the country began publishing its oil and fuel in Chinese yuan in September of last year. It recently added further insult to injury and launched the world’s first state-backed cryptocurrency, known as the petro. According to TIME, however, the petro is “in fact a collaboration – a half hidden joint venture between Venezuelan and Russian officials and businessmen, whose aim was to erode the power of U.S. sanctions.”

This development was enough to provoke the Trump administration into signing an executive order designating anyone who buys or uses the cryptocurrency as in breach of economic sanctions the U.S. slapped on Venezuela in August of last year.

Altogether, Trump has already imposed more than 20 individual and economic sanctions on Venezuela. For those who believe America’s infatuation with the country is about human rights concerns and that it has nothing to do Venezuela’s untapped oil reserves and its ties to currency, think again.

The main opposition leader who is up against incumbent leader Nicolas Maduro, Henri Falcon, currently has a former Wall Street economist advising him who believes that in order to solve Venezuela’s problems, it should rid itself of the bolivar as its official currency and replace it with the U.S. dollar. The U.S. has been spending millions supporting opposition activity in Venezuela and was doing so even under the Obama administration. Whether it is done subtly or overtly in Trump-esque fashion, the seeds of regime change in Venezuela are being sown throughout media discourse.

In mid-February, U.S. Admiral Kurt Tidd, head of the U.S. Southern Command, visited Colombia’s coastal city of Tumaco. This visit, combined with Trump’s statement last year that he was considering a “military option” in Venezuela, irked Venezuela into getting itself into a state of military preparedness.

Venezuela has not only reportedly been building up its military along the border with the South American nation of Guyana, but around the same time that Tidd visited Colombia, the Venezuelan Interior Minister, Néstor Reverol, allegedly also advanced the possibility of military action against Colombia.

In response, Guyana set up two army bases around the end of February, following similar moves from Brazil and Colombia. While the ultimate extent of this particular stand-off is still unclear, Reuters claimed that Venezuelan troops were already entering Guyanese territory. In the meantime, hundreds of thousands of Venezuelan citizens are making their way toward Brazil and Colombia in what is fast becoming a migrant crisis that will eventually surpass Syria’s.

Last year, a group known as the Lima Group was established to “restore democracy” to Venezuela. It consists of Argentina, Brazil, Canada, Chile, Colombia, Costa Rica, Guatemala, Honduras, Mexico, Panama, Paraguay, Peru, Guyana, and Saint Lucia. The group’s declarations include designating Venezuela non-compliant with the requirements of the Human Rights Council (remember that Canada is a country that supports Saudi Arabia), blocking the transfer of arms to Venezuela, and keeping track of the situation in Venezuela until “the full restoration of democracy” has been achieved.

Another geopolitical development worth keeping an eye on is Donald Trump’s appointment of notorious war-hawk John Bolton as national security advisor. While Bolton is known for his position on the Iraq war and his current animosity towards Iran and North Korea, he has used this anti-Iranian stance to demonize Venezuela even more so than is typically done in the corporate media.

In 2013, Bolton alleged that Iranians were operating in Caracas under the “largest Iranian diplomatic facility in the world,” laundering their money in Venezuelan banks. Together with Cuba and Nicaragua, Bolton already has his sights on Venezuela, countries he believes undermine American interests in the Latin American region. U.S. Senator Marco Rubio praised Bolton’s appointment — the same Rubio who advocated for the Venezuelan military to overthrow Maduro in a coup.

The other appointment to note is that of former CIA director Mike Pompeo to the position of secretary of state. He previously admitted that the CIA would like to see Maduro overthrown.

It appears Venezuela is well aware of these impending issues. Last year, Reuters also reported that Venezuela had 5,000 Russian-made MANPADS surface-to-air weapons, the largest known stockpile in Latin America.

Further, according to Russian state-owned TASS, this week Venezuela invited Russian military pilots who fought in Syria to share their experiences with Venezuelan personnel.

“We have discussed matters of our cooperation. We want to go beyond regular military and defense cooperation, to strengthen it and to develop cooperation at the operative level,” Venezuelan Defense Minister Vladimir Padrino Lopez allegedly told reporters after talks with his Russian counterpart, Sergei Shoigu, on Tuesday.

Lopez said he suggested “sending Venezuelan Su-30 pilots to share their experience in Russia and to invite Russian pilots, who received precious combat experience in Syria, to come and share it with their Venezuelan colleagues.”

Perhaps Venezuela is preparing for something worth us paying attention to in the not-too-distant future.

Creative Commons / Anti-Media

Written by Carey Wedler

(ANTIMEDIA) — Google made headlines last month when it was announced it was partnering with the Pentagon to develop artificial intelligence for use in drones flown over war zones.

The move divided the company, and this week, internal documentation of that conflict became available to the public in a petition signed by thousands of employees to the company’s CEO, Sundar Pichai, urging him to withdraw from the Pentagon partnership.

The letter, published this week by the New York Times, opens:

“We believe that Google should not be in the business of war. Therefore we ask that Project Maven be cancelled, and that Google draft, publicize and enforce a clear policy stating that neither Google nor its contractors will ever build warfare technology.”

The employees clarify the specific technology the company is providing:

“Google is implementing Project Maven, a customized AI surveillance engine that uses ‘Wide Area Motion Imagery’ data captured by US Government drones to detect vehicles and other objects, track their motions, and provide results to the Department of Defense.”

Google’s former executive chairman and current board member, Eric Schmidt, has insisted the technology will only be employed for non-combat situations. However, that has not eased the concerns of over 3,000 employees who signed the letter to Pichai.

“This plan will irreparably damage Google’s brand and its ability to compete for talent. Amid growing fears of biased and weaponized AI, Google is already struggling to keep the public’s trust,” they wrote, expressing concerns that the project will place Google among the likes of Raytheon, General Dynamics, and Palantir, notorious beneficiaries of the military-industrial complex.

They also reject the notion that the defense contract is legitimate because other tech companies may behave similarly:

“The argument that other firms, like Microsoft and Amazon, are also participating doesn’t make this any less risky for Google. Google’s unique history, its motto Don’t Be Evil, and its direct reach into the lives of billions of users set it apart.”

The dissenting employees further assert that this is a moral issue:

“We cannot outsource the moral responsibility of our technologies to third parties. Google’s stated values make this clear: Every one of our users is trusting us. Never jeopardize that. Ever. This contract puts Google’s reputation at risk and stands in direct opposition to our core values. Building this technology to assist the US Government in military surveillance – and potentially lethal outcomes – is not acceptable.”

In their conclusion — as with their introduction — they call on the company’s leadership to both withdraw from this contract and to vow that they will never participate in the development of warfare technology.

While the sentiment is admirable and drawing media attention, far less acknowledged is Google’s previous relationship with the government’s war agency.

In 2012, Google hired an employee from Darpa, the Pentagon’s technology and research arm. Wired reported at the time that while revolving-door-type relationship this seemed surprising because Google’s ties to the Pentagon were scant, it was actually just the latest development in Google’s “long and deeply complicated relationship with America’s military and intelligence communities.” Wired wrote:

“’Like Halliburton in the previous administration,’ warned the National Legal and Policy Center in 2010, ‘Google has an exceptionally close relationship with the current [Obama] administration’”

Writing for the outlet, Noah Schachtman noted that while Google may not customize its software for the government, its products are linked to federal agencies all the same and that its state-sponsored technology was ultimately used in warfare:

“Some of that software, though, only made it to Mountain View after an infusion of government cash. Take the mapping firm Keyhole, backed by In-Q-Tel, the investment arm of the Central Intelligence Agency. Google bought Keyhole in 2004 — and then turned it into the backbone for Google Earth, which has become a must-have tool in all sorts of imagery analysis cells. When I visited a team of Air Force targeteers in 2009, a Google Earth map highlighting all the known hospitals, mosques, graveyards, and schools in Afghanistan helped them pick which buildings to bomb or not.”

Google also has its hand deep in government surveillance efforts. Wired continued:

“During the first six months of 2011, U.S. government agencies sent Google 5,950 criminal investigation requests for data on Google users and services, as our sister blog Threat Level noted at the time. That’s an average of 31 a day, and Google said it complied with 93 percent of those requests.”

It provided private user information to the NSA through the PRISM program, and as Quartz has explained, Google’s founders Sergey Brin and Larry Page were funded by military grants in the 1990s as the intelligence community attempted to bolster mass surveillance when the internet was in its early stages. Quartz reported:

“The grants allowed Brin and Page to do their work and contributed to their breakthroughs in web-page ranking and tracking user queries. Brin didn’t work for the intelligence community—or for anyone else. Google had not yet been incorporated. He was just a Stanford researcher taking advantage of the grant provided by the NSA and CIA through the unclassified MDDS program [Massive Digital Data Systems, a project managed by military and intelligence contractors].”

Google employees’ willingness to challenge the company’s leaders over their collaboration with the Pentagon is admirable, but as they stress the motto “Do No Evil,” it may be the case that Google strayed from this policy long before it inked its most recent Pentagon deal.

Creative Commons / Anti-Media

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