Will Other Countries Be Okay with Bailing Out or Helping Britain and France? \ stacker news ~econ

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Will Other Countries Be Okay with Bailing Out or Helping Britain and France?

692 sats \ 12 comments \ @spiderman 31 Aug econ

So, I thought the IMF is an international organisation whose membership includes almost every country, unlike, for example, NATO.

So when countries like Britain and France seek (or even demand) bailouts (as many recent headlines are talking about, trying to normalise it by planting a seed), will countries which are not so friendly (Russia, China, Iran etc.), each of which is facing their own economic challenges, be happy with it?

Especially Russia, which knows part of the bailout will fund another round of donation of artillery shells or MLRS for Ukraine?

Or, China, which will see the bailout will be used to pay for (among other things) another freedom navigation/tour of HMS Queen Elizabeth around the Taiwan strait?

I am not trying to debate here which camp is right or whether Ukraine/Taiwan deserve help etc. But I am merely asking will asking for bailouts

Constrain the ability of the bailed out countries to conduct their military/foreign policy?
Can be used as bargaining chip by Russia/China who will concede some funds in exchange for some other assurance restricting Britain's ability to react as it could otherwise?

Or, is it the case that if Britain and France ask for bailout, they will get whatever they want, without Russia/China having any say in it?

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10 sats \ 0 replies \ @justin_shocknet 31 Aug

They can't be bailed out, the ponzi is global. The money is all fake and is relative only to other fake money.

War is just pretext for a hard reboot, Ukraine is an intelligence agency scripted Netflix special distributed through intel run media. Taiwan will be too. The results have been story boarded out years, maybe decades in advance.

Russia, China, US, Europe... It's all WWE.

The end of the ponzi necessitates consolidation. Vassal states are too expensive, those optics are going away.

UK, NZ, Australia, Canada, Greenland are already US states... We're just waiting on disclosure.

The baltics, Taiwan are part of the trade to their respective security zones.

With that kind of shakeup the global financial order becomes an afterthought.

0 sats \ 6 replies \ @Solomonsatoshi 31 Aug

In reality the IMF is effectively controlled by the USA. It is used to support US strategic and economic objectives. US control of global institutions especially financial institutions is a major factor in the operation of global US hegemony. Of the IMFs official reserve currency issuers only China whose Yuan was added 2015, are not militarily and monetarily subservient to the US. https://www.sbs.com.au/news/article/chinas-yuan-joins-imf-reserve-currencies/3bp2e2mhj The IMF, despite Chinas rising economic strength, remains organ of US hegemony.

7 sats \ 5 replies \ @spiderman OP 14h

In absolute terms the US is the most indebted sovereign nation in the world (probably the rankings look different when normalised by population or GDP etc.). So I am not sure the US has enough hard asset to bail out either of Britain or France, let alone both, especially if the latters' debts are not dollar denominated (my guess).

0 sats \ 4 replies \ @Solomonsatoshi 13h

You may have a point there but the wider point is that the IMF delivers strategic influence to the USA over multiple countries enabling it to force them to open valuable infrastructure assets and commodities to US corporate capture and control. In the case of the UK, the UK is already perhaps the most complicit with US hegemony having literally handed over their global empire to the US post WW2. In the case of France and Britain they both face significant pressure to increase military spending due to the withdrawal of US support for Europe. The entire western imperialist structure looks like it is facing potential insolvency and collapse in the face of Chinas rising power projection via Russia, Iran and N.Korea. If the Saudis openly ditch USD settlement for their oil sales and fully embrace the alternative trade payments protocols China is introducing (CIPS and mBridge) the end of western imperialism may be nigh.

14 sats \ 3 replies \ @spiderman OP 13h

Emarat, the largest gas station operator in the Emirates, will fill up your car tank for your...Satoshis.

Has there ever been a larger challenger to the petrodollar status quo? I do not believe Saudis will fall in the trap of one fiat jumping from another. Why would a digital yuan (or whatever fancy shit the CCP comes up with) be any better than Tether or some US treasury bills?

0 sats \ 2 replies \ @Solomonsatoshi 13h

The Saudis have already joined Chinas mBridge protocol and are reportedly already making sales via non USD protocols.

It would make good sense for many of the Muslim nations to adopt Bitcoin as it is free of debt and conforms very well the Islamic principles but China is the largest market now for their exports and UAE was a founding member of the mBridge protocol development group which also included Thailand and Hong Kong.

Perhaps the UAE are allowing sats internally but adopting Chinese protocol/s for international trade payments?

Would love to fill my van up with gas paying in sats! Hope it can one day happen here in New Zealand and great to hear it is already possible in the UAE. Good on them.

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Why would a digital yuan (or whatever fancy shit the CCP comes up with) be any better than Tether or some US treasury bills?

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USD dominance derives from US dominance in global trade and finance post WW2 when the other major power manufacturing and economies were decimated.

Today China dominates in global trade in manufactured goods and commodities- it therefore makes perfect sense for China to implement protocols which are native to its financial system rather than continuing to be forced to process trade payments with other nations via the USD and US financial institutions.

This building of its own 'in house' protocols has been Chinas openly stated and quite understandable objective for many years and it is now being implemented. They may not yet be seeking to replace USTs or act as a SoV currency but in terms of trade payments they have an arguably legitimate right to build and introduce their own trade payments protocols.

14 sats \ 1 reply \ @spiderman OP 12h

Of course, I am not the one questioning China's right to build their trade settlement platforms. Even at the private side, Visa and Mastercard enjoy a massive duopoly around the world as the only truly global payment processors, and if they have to face some cost competition because of whatever someone else has to offer (whether using Bitcoin, Ethereum or Fiat rails) that is always welcome too.

But sometimes I just wonder why would any country (except the US or China themselves) voluntarily end up beholden to one of their systems (Swift, Dollar settlement or CIPS etc.) when you have a politically neutral rail like the Bitcoin blockchain secured by more computing power than Google, Amazon and Microsoft combined.

Ah yeah, the volatility...and that reassures me I am still early in the Bitcoin (while I bite my finger everyday for not adopting a decade sooner).

0 sats \ 0 replies \ @Solomonsatoshi 9h

I dont think the volatility is so much the issue as power and control. The USD/SWIFT system has given the USA both huge power via the ability to sanction countries that do not conform to its expectations and wishes and because SWIFT is USD based SWIFT results in all central banks needing to hold significant quantities of USD in order to participate- thereby USA can print (digitally) almost limitless USD to satify the volume of currency needed to maintain global trade payments which is a large part of the extraordinary privilege that the USA has enjoyed via its global fiat 'petrodollar' hegemony. This has enabled the USA to live way beyond its means, having trade and fiscal deficits for the last 50 plus years and able to because almost everyone needs USD in order to participate in global trade payments. China, imo, rightly sees this as unreasonable and now increasingly seeks to organise trade payments denominated in its currency. Why should China be forced to denominate trade with say Nigeria, (or almost any other country) in USD simpkly because the USA holds a quasi monopoly over trade payments? When I have traded with China in the past IO had to pay a US bank to convert my NZD to USD in order to pay the Chinese supplier. Why can I not simply pay the Chinese supplier in Yuan and convert my NZD directly to Yuan without a US bank acting as a compulsory middleman clipping the ticked every time? This is why China seeks to build its own trade payments protocol/s - so that it can cut out the US banks and remove the risk of sanctions by the US and reduce costs for its merchants and trade partners trading with them. Ultimately of course if trade is increasingly denominated in Yuan that delivers leverage, wealth and power to China and reduces US leverage, wealth and power. IMO the competition between the US and China is centred on who controls the global trade payments system and if the USA loses its current dominance over that it loses pretty much all other dominance as its position is so hugely dependent upon the dominance of the USD.

0 sats \ 1 reply \ @OT 31 Aug

I haven't seen Britain or France asking for a bailout, but have seen people talking about it. Any source?

21 sats \ 0 replies \ @spiderman OP 31 Aug

No, they have not asked. The French minister warned about it (for France) and for Britain there have been certain projections by many media that it may happen. At least that is my understanding of the present situation. Google is your friend if you want some links.

13 sats \ 1 reply \ @Undisciplined 31 Aug

I'm sure you're onto something with this line of thinking. We certainly saw that China uses these international organizations to further its interests during the pandemic with the WHO. I'm sure the same will be true with the IMF.

In general, I suspect the 90% of nations that are poorer than Britain and France would resent the idea of bailing them out, especially when many of those nations feel like the IMF has been weaponized against them by the West in the past.

I'd expect there to be conditions attached to any loans that the people of France and Britain aren't comfortable with.

0 sats \ 0 replies \ @Solomonsatoshi 13h

China is just starting to do what the US has done for many decades- using these international governance organisations to project power and influence. As US power wanes China can be expected to exert more of this type of institutional power projection. The IMF added China and its Yuan to its exclusive list of reserve currencies in 2016 because China is now pivotal in terms of global trade and finance. Post GFC it was Chinas mercantile muscle that kept the USD based fiat debt monetary system afloat. China was and remains the only official reserve currency issuer that is not both monetarily and militarily subservient to the USA. We are seeing a decline of US hegemony and the rise of Chinese empire. Not content with increasing influence over legacy western imperialist international institutions and protocols China is increasingly building its own...like CIPS and mBridge and China Development Bank which already finds far more international infrastructure than the World Bank.