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2015/04/01

America: Decline of the World Bully

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This Powerful Man Has Led a Double Life

He's been the secret man behind some of the biggest movements and most successful companies in America today. He's sat shoulder-to-shoulder with figures like Boris Yeltsin, George Bush Sr., Steve Forbes, Lee Kuan Yew and Margaret Thatcher to name just a few. But for over the last three decades, he's led a double life. And today he's stepping forward to show you why he's done it… and the implications it could have for you, your wealth and your family. The full story on this mystery man is here.


America's Shrinking Authority

By Jeff D. Opdyke, Editor of Profit Seeker

today's editor

It goes that a wolf, in one of Aesop's fables, was passing through a pasture and came upon some shepherds in a hut dining on a haunch of mutton. The wolf approached and said to the shepherds: "What a clamor you would raise if I were to do as you are doing!"

The moral: Men are apt to condemn in others the very things they practice themselves.

Which brings us to the United States government and the hissy fit it's throwing over the Asian Infrastructure Investment Bank. The affair points, first and foremost, to the hypocrisies endemic in America today. More importantly, it shows that America's place in the world — and by association, the dollar's place in the world — is diminishing. Those who understand this are in position to prepare for what's to come.


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The infrastructure bank, known as the AIIB, is the brainchild of China. Given China's wealth, size, newfound global openness and expanding power and influence around the world, the Chinese have begun building doppelgangers of Western institutions that for years have shaped global economic policies. China and Russia, for instance, are behind a push to create a new iteration of the International Monetary Fund that would aid less-developed nations and do so without "the harassment of countries that do not agree with some foreign policy decisions made by the United States and their allies."

Now comes the AIIB, designed to compete against the World Bank and its Asian offshoot, the Asian Development Bank. The AIIB mission: To finance infrastructure projects throughout Eurasia and Africa.

Like a schoolyard bully no one respects anymore, the U.S. has belittled the AIIB, claiming any Chinese-led lending institution will fail to impose rules and standards that would protect the environment (not that America has such a pristine record of doing so, but that's neither here nor there).

The U.S. had a chance to join the bank as a founding member. It spurned that opportunity … and then in a fit of ignorance laced with latent jealousy, it told its key allies to spurn the bank, too.

Only … NO ONE LISTENED!

And therein we find a flashing marquee sign pointing to a very painful reality for Americans who blindly buy into the awkward — and fading — notion of American Exceptionalism.

Nothing More Than a Bully

It is no surprise that a rash of more than 20 Central, Southern and Southeast Asian nations have signed on as AIIB members, including America's regional ally, South Korea. It's probably no surprise that Russia and Turkey have joined, as have the Saudis and other Middle Eastern nations that are purportedly friendly to America.

But it should come as a shocker that Britain — America's closest ally — signed on as a founding member of the AIIB … despite Washington's protestations. It should also cause a mental ripple that Australia, Austria, Brazil, France, Germany, Italy, Luxembourg, Netherlands, New Zealand, Spain and Switzerland have joined. Japan will join, too. Taiwan and Norway are on deck, as well. That leaves the U.S. (and Canada, to a much lesser degree) conspicuously absent.

Why, you have to wonder, is the U.S. playing the role of intransigent narcissist as the rest of world rushes to join a bank that will help lift the living standards of several billion people from Southeastern Asia all the way to West Africa?

Very, very simple.

The U.S. dollar.

America fears that the Asian/European economic cooperation necessary inside the AIIB — and the developing-nation acceptance of AIIB investments — will undermine dollar hegemony. For once, the U.S. is right. That is exactly what will happen — and, honestly, is already happening.

America has spent the post-World War II decades imposing its will on the world, in the process pissing off a lot of people, even our friends. Some of that is reflected, even if covertly, in decisions made by Western nations to join the AIIB.

And, yet, anger at America isn't the only reason, or the best reason, to join the AIIB. Opportunity is — which is exactly what every nation is pursuing when they join the AIIB.

The bank's footprint covers a (very large) swath of the world where economies and consumers are rapidly emerging. If I'm Britain or Germany — or Australia or Brazil — I absolutely want deep access to those economies, and I don't care if I disregard the wishes of my friend, because my friend's wishes run counter to my personal success.

Key Protection

For America, this is the most serious existential threat we face as a nation.

This isn't just a story about friends snubbing our desires. It's the story of the knock-on effects here at home of a world in which dollar hegemony recedes into history. Painful repercussions radiate from that.

Because of the size of our national debt — now exceeding $18 trillion — America must constantly rollover boatloads of U.S. Treasury paper, one-third of which we sell globally to fund our profligacy. As demand for the dollar wanes (and the AIIB is just another example of why that will happen), U.S. interest rates must rise in order to attract a similar level of investment from global buyers of our debt.

That, in turn, raises the cost of keeping the lights on in America. It also raises the costs — likely beyond affordability — of keeping U.S. troops stationed in various parts of the world, which ultimately reduces our influence. And it screams through the U.S. economy, leaving in its wake hardship and increasing poverty (and, remember: we are a country where fully one-half the population already cannot afford a $500 emergency expense).

The AIIB, and our friends who have joined the bank as founding members, brings into harsh focus the troubling reality that we are now in the midst of an empire's collapse. It's hard to see from the inside, and not something most of us want to accept.

But the dots methodically continue to connect. The only protection is having some of your wealth outside the U.S. dollar. When capitulation comes — and it will — the rising value of foreign currencies relative to the dollar will be the only saving grace protecting your lifestyle from the radiating pain.

Until next time, stay Sovereign…

Jeff D. Opdyke
Editor, Profit Seeker

P.S. The decline of the U.S. dollar is just a beginning of greater problems that America faces. It's time to make your plans for protecting your wealth and your freedom. But acquiring a second passport or a second residence is a significant undertaking. For an excellent resource to help you plan, click here to learn more about The Passport Book.

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