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Grandmaster Putin's Golden Trap

Nov 26, 2014

 The financial war between the US and Russia has been going on for some years, but it became an overt war last March. Neither side wants a nuclear war (we hope), but when the US slapped Russia with economic sanctions--and forced Europe to doing the same--the war officially began for all to see.

News accounts in the mainstream media tell us Obama's strategy of sanctions against Russian businesses and businessmen and politicians and banks from buying goods from the West. This has hurt Russia to some extent, but the real losers are the European companies that had sold their goods to Russian buyers. Russia is now turning to China to buy those goods, leaving the Europeans looking more and more like the ones being sanctioned.

A very insightful article has now appeared, showing Putin's grand strategy. I have wondered for months why Putin doesn't just demand gold or even euros in payment for oil and gas being piped to European countries. Such a strategy would seem logical in a financial war. Well, the article below tells us that this is exactly what Putin is doing... sort of.

Instead of demanding payment in gold, Putin is simply converting all dollar sales into gold purchases. That way, Putin can keep up appearances that he accepts the petro-dollar alive, while, in fact, the net result is that the dollar is being rejected under the table. In the third quarter of 2014 Russia purchased 55 tons of gold--more than all the other nations put together (by official reports).


 Very few people understand what Putin is doing at the moment. And almost no one understands what he will do in the future.

No matter how strange it may seem, but right now, Putin is selling Russian oil and gas only for physical gold.

Putin is not shouting about it all over the world. And of course, he still accepts US dollars as an intermediate means of payment. But he immediately exchanges all these dollars obtained from the sale of oil and gas for physical gold!

To understand this, it is enough to look at the dynamics of growth of gold reserves of Russia and to compare this data with foreign exchange earnings of the RF coming from the sale of oil and gas over the same period....

Thus, in exchange for Russian oil, gas and uranium, the West pays Russia with dollars, purchasing power of which is artificially inflated against oil and gold by the efforts (manipulations) of the West.  However,  Putin uses these dollars only to withdraw physical gold from the West in exchange at a price denominated in US dollars, artificially lowered by the same West.

This truly brilliant economic combination by Putin puts the West led by the United States in a position of a snake, aggressively and diligently devouring its own tail....

 How long will the West be able to buy oil and gas from Russia in exchange for physical gold?

And what will happen to the US petrodollar after the West runs out of physical gold to pay for Russian oil, gas and uranium, as well as to pay for Chinese goods?

No one in the west today can answer these seemingly simple questions.

And this is called "Checkmate", ladies and gentlemen. The game is over.

The article goes on to tell us that China is not only backing Russia by ignoring the sanctions, but is also using the same strategy against the US dollar. China has made the decision to freeze the level of US dollars in its reserve. Since China exports five times as much as it imports from the US, this means that the dollars they earn are also going into something else. Its excess dollars are being converted to gold, and the gold pipeline from West to East continues.

This will continue until the COMEX can no longer fill its orders for gold (and silver). Then someone will proclaim "Check Mate," and life will suddenly become quite different.

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Category: Financial
Blog Author: Dr. Stephen Jones