Very “quietly” the world’s 20 largest economies will meet in Brisbane, Australia later this coming week. I use the word “quietly” because here in the U.S. almost no mention of the upcoming meeting has been made. I even searched for news on the event and almost could find none. Strange?
Well yes and no, quite strange because it surely is big news especially with all that has been going on but not strange because here in the U.S. we must keep a happy face on things which very well may not be the outcome this time around. I wasn’t sure how I was going to write this piece but I guess it’s just easiest to tell you what I think the result will be and then explain why.
In my opinion, once this meeting is over next Sunday all hell could break loose financially. I say this because much has already been put into place ahead of time and it is my expectation the U.S. and her dollar will at a minimum be taken off of “the top shelf” or at least be pushed back from the front. Let me put forth some of the many available dots and see if they can’t be connected.
First, if you remember last year’s summit, president Obama was not pictured in the center as the U.S. has always been at nearly all meetings such as these traditionally. If I recall, I believe I commented that he was positioned on one of the ends and I took it as “not a very good sign” at the time. This time around, president Obama will arrive as a “neutered” force after the Democrats lost total control of Congress. This fact is not lost on the world, they now know president Obama has no collateral nor clout left and will be the lamest duck president in history. One could argue this point but he has lost Congress while having the lowest public approval rating of any U.S. president.
We also know that China has been making business deals, setting up renminbi currency hubs, and either preparing for or actually doing trade in local currencies or their own all over the world. The Chinese have been forming these deals WITHOUT the use of dollars. Russia, who for the last 5-6 months have been the focus of “Western sanctions” have also been active in doing trade deals, particularly with China. If you recall, Russia achieved their “Holy Grail” gas deal earlier this year with China worth an estimated $400 billion.