Well, an interesting week last week indeed. Seemingly the headlines revolved around the Asian Infrastructure Investment Bank (AIIB). Two notables that applied to be included in the AIIB were Taiwan and Israel. Taiwan, a modern history of not seeing eye-to-eye with “Mother China,” and Israel, one of the closest allies the U.S. has politically, strategically, and religiously. For the most part, why did Israel put forth an interest in the AIIB?
It’s no secret that Israel and the U.S. just cannot get on the same page geopolitically. Israel has concerns about their safety and sovereignty while the U.S. supplies arms to and obliges Israel’s neighbours. Indeed, although there is more to it than just this, the average man on the street knows and senses all is not well with these two countries.
Is this part of the reason Israel applied to the AIIB? In this writer’s opinion, no. Israel did not apply to the AIIB as a means to “ruffle America’s feathers.” In this writer’s opinion, Israel applied to the AIIB because like all those whom also applied, it seems nations are looking for a U.S. dollar alternative outside of the SWIFT system. Nations, governments, organisations, etc., want to conduct business and receive or be paid in currency that has some sort of value they can trust and believe in. In short, they want out of the dollar and they do not want to be under the thumb of the U.S. or its military. This is not about friendships or being allies. This is purely business.
In addition, China wants its currency to be included in the SDR. If this is so, soon or very soon, China must reveal it’s true and honest gold holdings in order to be included in the SDR. Many believe China may easily be holding upwards of 10,000 tonnes of gold. If this is so, one can reasonably and rightfully expect the gold price to rise, and silver to follow all while the U.S. dollar declines. This is another reason this writer believes the U.S. closest allies; Saudi, France, the U.K., Italy, Australia, Israel, Germany, and others are yes, ditching the dollar and trying to find shelter in the AIIB.
In the U.S., the Federal Reserve desperately wants to raise the interest rate in order to in part bring back some sort of credibility to the U.S. dollar. In the end, we all know the U.S. must reform their financial system. If not, governments and politicians will unfortunately, and at the world’s peril, seek to blame others. They will invent every type of excuse by hiding the truth in the fog of war. Sadly it seems the dominoes are all lined up all over the world and they are set to fall.