Summary: Timing is everything - Russia builds troop forces towards Ukraine<br> Asia heats up with military sabrers rattling at sea<br> Presidential personal interests play no role in pipeline politics - right...<br> <br> <br> <br> The McAlvany Weekly Commentary<br> with David McAlvany and Kevin Orrick<br> <br> Pay No Attention To The Digital Yuan, Taiwan, & Ukraine<br> April 13, 2021<br> <br> “In a world where no one cares about US carrots and the US cannot meaningfully use its sticks as sort of an enforcement mechanism. I wonder where we think the US dollar is going here. I think it is to some degree delusional to think that the status quo can be maintained where we are in a massive social restructuring on a domestic basis with a currency that has been a pillar of strength primarily reflecting weakness everywhere else.” — David McAlvany<br> <br> Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick along with David McAlvany. <br> <br> David, your dad’s back in town and you guys are talking geopolitics. And I was just thinking what a wonderful thing when McAlvanys start talking about geostrategy, geopolitics. And there’s plenty to talk about right now, not just in Asia, but in Europe.<br> <br> David: Of all the things that hit the news headlines, nothing raises my blood pressure like my dad being in the same room with me. I love him dearly, but you have to know him to know just what kind of an impact, what kind of a whirling dervish he can be.<br> <br> Kevin: He’s in from the Philippines.<br> <br> David: Yeah. There are a few risks that are difficult to model. And the two things that come to mind, one, we get the South China Sea and the Taiwan Strait. There is Russia’s move with their troops into the Ukrainian border and the US responding by sending in military hardware. And why are we interested in either one? I mean, clearly the fact that you’ve got a Naval fleet of warships there in the Taiwan Strait in the South China Sea, my parents are keen on that as they’re just a few miles away in what may within months be a hot zone. <br> <br> Covid-related lockdowns and the growing likelihood of martial law in the Philippines have both my mom and dad back in the United States for a little while. Actually, the first time we’ve seen him in almost two years. So we’re very glad to have him.<br> <br> Kevin: One of the things that you’ve brought out, Dave—and your dad for the three and a half decades that I’ve known him—is that war looks very different in geostrategy, and geopolitics looks very different if you look at it from a financial standpoint. And I know why Taiwan is particularly interesting to you. Your parents are over there, but you were talking about the digital yuan last week. And so you have military moves, but you really can’t do things with currency changes unless you’ve got the military to back it.<br> <br> David: And which comes first, the chicken or the egg? Things of a geostrategic nature or of a monetary, economic nature? We covered some of the macro, monetary, and economic considerations last week in talking about the digital yuan. By the way, Bloomberg covered the Chinese digital currency story again, but from a different angle over the weekend. And the conclusions were fascinating. The central bank digital currency is not a workaround for sanctions, that there are no concerns on toppling the dollar as the world’s reserve currency, that it is not a threat to the US dollar as a reserve asset or as a currency in use for trade settlement. I mean, as I read through it, Kevin, basically the things that Bloomberg covered in a very dismissive tone shined a very bright light on all the issues of particular concern. It was the real issues. But the two most disturbing aspects of that article from Bloomberg over the weekend were Yellen’s discussion on financial inclusion, which is basically a commitment to kill the use of cash in th...
