Sunday, October 12, 2008

The International Banker's China Syndrome

I will get straight to the point. My belief is that this financial "crisis" that we are in was deliberately planned. This is part of a plan to transfer economic power from the United States to China. The people behind the plan are the International Bankers. They have been setting up this scenario for at least 20 years if not longer. One of the main conspirators is Alan Greenspan who knowingly created this bubble. The transfer of power to China will occur by giving it more power in the IMF. China will also be included in an expanded G-7. The current "crisis" will be used as the excuse or the cover for this transfer. The International Bankers who are behind this plan have already profited enormously from this scheme. They are willing to sacrifice the economies of the World in order to carry their plan through to the end. The motivation is to weaken the global power of the US which is seen as too independent for their purposes. China is the prototype of the neo-Fascist government which they seek to impose upon the world.


Alan Greenspan - former Federal Reserve Chairman
Ben Shalom Bernanke - Federal Reserve Chairman
Henry "Hank" Paulson - US Secretary of Treasury
Stanley Fischer - Governor of the Bank of Israel
Milton Friedman - economist (deceased)
Robert B. Zoellick - Head of World Bank
Sen. Phil Gramm (R-TX)
George Soros
George W. Bush
Ronald Reagan
Richard Nixon
Henry Kissinger
Goldman Sachs
JP Morgan
Bank of America
Rothschild family
Rockefeller family
CFR - Council of Foreign Relations
Skull and Bones
Aspen Strategy Group
G30 - Group of Thirty


While I can't offer any definitive proof that there is a conspiracy by the International Bankers to shift economic power from the US to China, I can offer some anecdotal evidence. As for motive, I believe that the Chinese neo-Fascist model that it has adopted since 1978 is considerably more profitable for the International Bankers than US style capitalism. This essentially is a new form of slavery. One of the problems with a system like slavery is that it is impossible for others to compete against it. So in a free trade world without barriers, the one who adopts slavery first is the winner. In this case China with its almost unlimited supply of cheap labor and its autocratic style of government is the clear winner.

The conclusion is that "free" trade is actually slavery in disguise and we should all be opposed to it. The solution is to protect local industries through trade barriers. As you would expect, Milton Friedman has been the champion of "free trade". It is part of his philosophy of laissez-faire economics that was heartily adopted by Ronald Reagan. The opposite of "free trade" according to this school of thought is "protectionism", and of course that must be avoided at all cost. Friedman pretends to be on the side of the consumer, but actually he is just on the side of the International Bankers who are the ones who benefit the most from "free" trade. Naomi Klein does the best job of refuting the Miltonian economics.


And it isn't just free trade. It's all of these.

  • deregulation
  • free trade
  • privatization
  • cuts to government spending
The next stage which we have already entered is "privatization". After the bailout the US will be left with an even greater national debt. The "solution" which will be offered is privatization. This is nothing less than selling off the US piece by piece to the highest bidder. It has already begun. Highways are being "privatized". Chicago's Midway Airport is being "privatized".

Goldman Sachs has been at the forefront of the drive to privatize American assets. Basically this amounts to mortgaging America. Selling it off in pieces for a quick sum of money and then renting it back. If it sounds like America is going into hock, it is. We will end up renting back America like modern day sharecroppers instead of owning America. And the country sitting on the biggest pile of dollars out there is China. So China will end up owning a large chunk of America. But this is the plan. This is the inevitable outcome of the huge trade surplus and the enormous debt that the International Bankers have been encouraging the US to accumulate all these years.

Another way of looking at this is that America will become a colony of the International Bankers. And we will be forced to pay tribute in the form of taxes and inflation and usage fees for the highways and airports that we used to own. The thing that makes this such a diabolical scheme is that the average American will never realize that he or she has become a slave and especially won't realize who his or her master really is. We will blame the government, but the government will be powerless to make any changes or to defend us.

The military option?

The one asset that the US still retains that provides it a global advantage is the US Military. But of what use is the military against a faceless enemy like the International Bankers? It is even more futile than the War against Terrorism. In the past we had a policy to restrict the transfer of technology to other countries, especially our enemies. But today high tech companies are busy opening up research labs in China and India. And our military does joint development with Israel and other countries. So the military and technological advantage of the US is slowly eroding.


1964 - China detonates its first nuclear weapon.
July 1971 - Kissinger goes on a secret mission to China.
October 25, 1971 - Mainland Communist China replaces Republic of China (Taiwan) on the UN Security Council. Taiwan loses all representation in UN.
February 1972 - Nixon engages in direct talks with Chairman Mao Zedong. Nixon issues the Shanghai Communiqué which states that there is only one China and that Taiwan is part of China.
1978 - Economic reforms called "Socialism with Chinese characteristics" were started by pragmatists within the Communist Party led by Deng Xiaoping. The goal of Chinese economic reform was to generate sufficient surplus value to finance the modernization of the economy.
January 1, 1979 - The United States transferred diplomatic recognition from Taipei to Beijing.
January 1981 - Ronald Reagan becomes President of the United States.
1985 - Beginning of S&L crisis as Ohio and Maryland declare "Bank Holidays" to stop runs on the banks.
August 1987 - Alan Greenspan appointed Federal Reserve Chairman by Ronald Reagan.
October 19, 1987 - Stock Market crashes on Black Monday. Biggest single day loss in history - 22%.
June 1989 - Tiananmen Square protests in China brutally suppressed.
September 16, 1992 - George Soros "breaks the Bank of England" earning an estimated US$ 1.1 billion and forcing it to devalue the pound.
July 1997 - Asian financial crisis.
November 12, 1999 - Bill introduced by Phil Gramm that repealed the Glass-Steagall Act was signed into law by Bill Clinton.
March 2000 - Dot com bubble bursts.
December 15, 2000 - Phil Gramm introduces Commodity Futures Modernization Act (CFMA), which prohibited any governmental regulation of credit default swaps (CDS), on the last day before Christmas Holiday. It was never debated in Congress.
January 2001 - George W. Bush becomes President of the United States.
July 13, 2001 - 2008 Summer Olympics awarded to Beijing.
September 11, 2001 - World Trade Center attack.
October 7, 2001 - US invades Afghanistan.
December 11, 2001 - China accepted into WTO. Robert Zoellick was the US negotiator.
2003 - Warren Buffett warns that derivatives are "financial weapons of mass destruction".
March 2003 - US invades Iraq.
June 4, 2003 - "Hank" Paulson, the chief executive of Goldman Sachs, completes joint venture that gives the firm greater access than any other foreign investment bank to China's increasingly lucrative financial services market.
2005 - Lenovo of China completes the acquisition of IBM’s Personal Computing Division, making the company the world's third largest computer manufacturer.
2005 - Bank of America acquired a 9% stake in China Construction Bank for $3 billion. CCB is the 2nd largest bank in China.
2005 - China National Offshore Oil Corporation, known as CNOOC, one of the huge state-owned oil companies, made a $18.5 billion bid for Unocal which was rejected by the US Congress.
2005 - Zhou Xiaochuan, Governor of China's Central Bank, joined the influential Washington based financial advisory body, the Group of Thirty.
February 1, 2006 - Ben Bernanke succeeds Greenspan as Chairman of the Federal Reserve.
April 2006 - China's President Hu Jintao visited the United States.
May 30, 2006 - "Hank" Paulson nominated by Bush to be Treasury Secretary.
August 2006 - Aspen Strategy Group holds "China’s March on the 21st Century" conference.
December 2006 - First Semi-Annual Strategic Economic Dialogue. Attendees include US Treasury Secretary Henry Paulson and six other cabinet members plus the Chairman of the Federal Reserve, Ben Bernanke.
July 1, 2007 - Robert Zoellick becomes president of the World Bank.
December 11, 2007 - Grand Opening of the NYSE office in Beijing.
March 2008 - Wang Qishan elected Vice-Premier.
June 2008 - Latest meeting of U.S.-China Strategic Economic Dialogue. Senior representatives from US and China are "Hank" Paulson and Wang Qishan.
August 2008 - Beijing Olympics - China's "coming out party".
September 2008 - Current Wall Street panic begins in earnest.
October 3, 2008 - Passage of Wall St. Bailout Bill

"Hank" Paulson and Vice Premier Wang Qishan - Partners in Crime

In the most recent meeting of the U.S.-China Strategic Economic Dialogue in April 2008, the senior representatives from US and China were "Hank" Paulson and Wang Qishan. Wang and Paulson are no strangers. In fact you could say they're partners. In 2003 when Paulson was CEO of Goldman Sachs, he struck a deal with Wang. At the time Wang was the Mayor of Beijing. Paulson was trying to gain access to the Chinese financial services market for Goldman Sachs.

As a condition of the deal the Chinese demanded that Goldman make a $67 million "donation" to cover investor losses at a failed Chinese brokerage firm. The firm in question was a state-owned enterprise, Hainan Securities, whose officials had been accused in lawsuits of embezzling millions of dollars from investor accounts. This money was to be used to pay out depositors whose money had been embezzled. Goldman also agreed to lend $100 million to a 52-year-old Chinese banker named Fang Feng Lei, and his partners.
Wang had been Hainan's party secretary from 2002 to 2003. Hainan is China's smallest province. Hainan is also the largest Special Economic Zone laid out by Chinese leader Deng Xiaoping in the late 1980s.

China gives the Special Economic Zones special economic policies and flexible governmental measures. This allows SEZs to utilize an economic management system that is especially conducive to doing business that does not exist in the rest of mainland China. Hainan is an island and the special economic policy that the government gave it seems to be in regards to real estate development. It seems that China was looking to attract tourists to beach resorts there.

Here's a choice quote from a NY Times article.
Mr. Fang had met often with the founders of Hainan Securities in the early to mid-90's. He set up a real estate subsidiary in Hainan for China Construction Bank at the request of Mr. Wang, then the bank's head, in 1992. That company, Intime Holdings, invested more than $1 million in a beachfront real estate project with Hainan Securities, according to company documents. That real estate project now includes a hotel that Mr. Fang's brother operates. The property on which the hotel sits was later acquired by a conglomerate that Mr. Fang and Mr. Zhou, the central banker, helped prepare for a public offering when they were with C.I.C.C.
It seems there was plenty of money to be made in Hainan real estate. And it would not be surprising to find out that Chinese officials were getting a cut. But they got too greedy and ended up owing $67 million to their investors. It sure was nice of Hank Paulson to pay off those investors. And I'm sure the people at Hainan Securities that were being sued were relieved as well. Did I mention that Hainan Securities was a state-owned enterprise?

Here's some more choice quotes.
Goldman officials were reluctant to invest in any brokerage firm with a checkered past. But by June 2003, Mr. Fang and Mr. Wang stepped into the negotiations and helped Goldman massage the deal, the people involved in the talks said.
But there is no evidence that Mr. Fang or Mr. Wang was involved in fraud at Hainan Securities, or that Goldman's donation money will benefit them in any way.
Of course not. Why would anyone think that? Just because they were the ones negotiating the deal? Nonsense. And I'm sure Mr. Fang didn't benefit from the $100 million personal "loan" from Goldman Sachs either. Of course not. He probably wanted to donate it to his favorite orphanage or something like that.

By this time you've probably noticed that Mr. Wang has worn many hats in his career. And you're also wondering who Mr. Fang is. Well here's what he was doing in 2005.
A few weeks ago, Charles Li and Fang Fenglei, two Chinese-born bankers, were at the center of things when the China National Offshore Oil Corporation, known as Cnooc, one of the huge state-owned oil companies, made a $18.5 billion bid for Unocal. That deal alone could earn lawyers and investment bankers up to $300 million in fees.
Another player in this deal was the then Goldman CEO "Hank" Paulson. Who was said to be pushing this deal "behind-the-scenes". Ultimately the deal fell through when the US Congress rejected it because it would give China control over a strategic US oil company.

And here is the ultimate endorsement of Mr. Fang.
Fang is now perhaps the most connected investment banker in China. A former People's Liberation Army soldier, Fang is close to the central bank chief, Zhou Xiaochuan, and is prized for his inside knowledge of Communist Party workings.

He is the only Chinese-born top banker without a Western degree, or English fluency. But that did not prevent Goldman Sachs from hiring him last year to run its joint venture investment banking operation in Beijing, and extending a $100 million loan to him.
The G30 invites China's Central Banker

Zhou Xiaochuan is currently the Governor of the People's Bank of China and is the man in charge of China's monetary policy. In 2005 Zhou Xiaochuan was invited to join the G30 or Group of Thirty. This is not like the G7 which is an organization of the top economic government officials from US, Japan, Germany, France, Britain, Italy and Canada. No, the G30 is a private group. It was founded in 1978 by the Rockefeller Foundation

Here are the current members according to Wikipedia. Notice that there are actually 28 members and not 30.
Paul Volcker - Chairman of the Board of Trustees; former Chairman of the Federal Reserve
Jacob A. Frenkel - Chairman; Vice Chairman, American International Group
Geoffrey L. Bell - Executive Secretary; President Geoffrey Bell and Company
Leszek Balcerowicz - Former President, National Bank of Poland
Jaime Caruana - Counselor and Director, MCM Department, International Monetary Fund
Roger W. Ferguson, Jr. - Chief Executive, TIAA-CREF
Stanley Fischer - Governor, Bank of Israel
Mervyn Allister King - Governor of the Bank of England
Guillermo Ortiz Martinez - Governor, Banco de México
Jean-Claude Trichet - President, European Central Bank
Tommaso Padoa-Schioppa - Minister of Economy and Finance, Italy
Zhou Xiaochuan - Governor, People's Bank of China
Yutaka Yamaguchi - Former Deputy Governor, Bank of Japan
E. Gerald Corrigan - Managing Director, Goldman Sachs, former President of the Federal Reserve Bank of New York
Andrew Crockett - President, JP Morgan Chase
David Walker - Senior Advisor Morgan Stanley
Guillermo de la Dehesa - Director and Member of the Executive Committee, Grupo Santander
Arminio Fraga Neto - Partner, Gávea Investimentos
Domingo Cavallo - Chairman and CEO, DFC Associates, LLC
Martin Feldstein - President, National Bureau of Economic Research
Paul Krugman - Professor of Economics, Woodrow Wilson School, Princeton University
Lawrence Summers - Charles W. Eliot University Professor, Harvard University
Ernesto Zedillo - Director, Yale Center for the Study of Globalization, Yale University, and former President of Mexico
Gerd Häusler - Vice-Chairman Lazard International
Abdulatif Al-Hamad - Chairman, Arab Fund for Economic and Social Development
Montek Singh Ahluwalia - Deputy Chairman, Planning Commission, India
Mario Draghi - Governor, Bank of Italy
Timothy F. Geithner - President, Federal Reserve Bank of New York
But I'm sure there's no conspiracy involved here. No not at all. Just a bunch of banker guys getting together to talk about money.


unlawflcombatnt said...

Great post, Frank.

When I first heard of the notion of an international banking conspiracy, over 30 years ago, I had serious doubts. I don't any longer.

Is there any chance you could post this on my forum: Economic Populist Forum ?

Frank Hope said...

Hi Combatant,

Thanks for your generous feedback. It is always encouraging to hear that others appreciate the work that I put into my writing. While I don't think this is my best article, it is perhaps my longest. I posted some excerpts on your economic forum with a link back to here for the full article.

I've been trying to write a post about what I see as one of the major consequences of the current financial "crisis", which is that economic power will transfer from the US to China as a result. I finally gave up on trying to make it a literary masterpiece and just tried to share as much information on the subject as I could.

The other message I wanted to convey is that I am more and more convinced that this "crisis" was no accident. When huge sums of capital go pouring from one economy to another as has happened in the past 20 years from the US to China, you can be sure that there has been a hand behind it. And it's not the "invisible hand". It is the hand of the International Bankers.

Anonymous said...

Frank, I really appreciate the amount of time and effort you put into your research and your writing. It's really enlightened me and opened up and answered a lot of "why's" that have been floating around, as it relates to motive.

I've been reading your blog for some time now and have been a bit shell shocked as to the relations of our treasury secretary and Chinese officials. The conflict of interest there is unbelievable.

As naive as it sounds, I've been attempting to funnel this information to members of congress to spread awareness. I'm sure it's been falling on "deaf ears" but I'll continue to spread the word as much as possible.

Thanks again for all your hard work.

Frank Hope said...

Hi Dan,

Thanks very much for your comments. As an active reader of my blog, you may have noticed that I've been inactive recently.

There are a couple of reasons for this. I've been thinking about writing a post. Partly it is because I've felt a post Presidential campaign letdown. Unfortunately, I'm not optimistic about a President Obama. And I'm not sure that people are ready to hear the criticisms that I have of him.

The other reason is that I was kicked off of Digg. Without Digg, I don't know how to direct enough traffic to my blog. It's encouraging to know that I have some regular readers like yourself. I do have StatCounter for my blog, and when I checked it today I found that this post about China is the most popular one right now. I was also surprised to see a fair amount of traffic to my blog after such a long period of inactivity.

Well Dan, you have inspired me to write some more. You can look forward to new posts in the coming days.

Please do share this information. Especially with members of Congress. We could certainly use a change in policy that favors the American people over the International Corporations.

Thanks for reading,

This comment has been removed by a blog administrator.
This comment has been removed by a blog administrator.
Anonymous said...

Here from a comment you made that contained your blogs link from reddit.

Great article you have here, opened my eyes on something I have not passed on before.

Also your comments on reddit were very good.

Keep it up. I bookmarked your website.

Frank Hope said...

To: John Wallace

Your comments are welcome, but if you want to refer to an article then leave a link with a few sentences that describe it. Don't post the whole thing or I'll delete it, as I'm sure anyone else would.

Frank Hope

Frank Hope said...

To: Anonymous

I think we met on Reddit. Thanks for your comment. I'm glad you were able to get something out of it. As I've said I sometimes think this post is a bit long. It's sort of 3 articles in one. I particularly like the timeline and have come back to refer to it from time to time.

I recently came across this article:

I was doing a Google search for my article and got a link to this one which was written in 2005. What's interesting is that at the same time that Bank of America bought a stake in China Construction Bank, other groups were also buying into Chinese Banks.

"On August 3, a $3 billion investment secured a 10% equity stake in ICBC for American Express, Goldman Sachs and Allianz, a large German insurer."

"Also in August, a consortium consisting of the Royal Bank of Scotland, Merrill Lynch and a private Hong Kong billionaire, bought 10% of China's second-biggest lender, Bank of China (BoC)."

"So, in the short space of three months, three of China's largest banks have major western ownership. This is nothing short of a stampede."

And then a few years later we have the financial meltdown of US Banks, and Paulson begging for a bailout. It's interesting that Paulson refused to put any limitation on any of the bailout money going to foreign banks. Hmmmm.

Could it be that profits have been spirited over to China while the US divisions were left with all the bad debt? Just something to think about.

I read an article I while back about how the Arabs got stiffed by the Americans. They got the Arabs to invest their oil money in some US companies then they declared the US companies bankrupt, but meanwhile the profits had been transfered to other companies. But the Arabs were broke. Sounds familiar. Sorry but I don't have a link. I think it was actually a video by Lindsey Williams. If I find a link I'll post it.

Frank Hope said...

Just one more comment for today. Take a close look at the members of the G30, you may recognize some of the names. Quite a few of them are now on Obama's economic team.

Timothy Geitner will be the new Treasury Secretary.
Lawrence Summers will be chairman of the National Economic Council.
Paul Volcker will be chair of the newly formed Economic Recovery Advisory Board.

That leaves Paul Krugman who won the Nobel prize recently. You may want to pay extra attention to his articles in the coming year. Not because of the Nobel prize, but because he has insider information from sitting in G30 meetings with Geithner, Summers and Volcker.

Frank Hope said...

One more comment. I forgot to mention this. In a new article from Rockefeller's CFR (Council on Foreign Relations) they basically agree with some of my points in this article.

From CFR Article(January 2009):
"No country will benefit economically from the financial crisis over the coming year, but a few states -- most notably China -- will achieve a stronger relative global position... The Obama administration could lead efforts to bring China into the G-8 (the group of highly industrialized states) and expand China's shareholding position in the International Monetary Fund. China, in turn, could lead an effort to enlarge the capital base of the IMF."


From My Article (October 2008):
The transfer of power to China will occur by giving it more power in the IMF. China will also be included in an expanded G-7. The current "crisis" will be used as the excuse or the cover for this transfer. The International Bankers who are behind this plan have already profited enormously from this scheme. They are willing to sacrifice the economies of the World in order to carry their plan through to the end. The motivation is to weaken the global power of the US which is seen as too independent for their purposes. China is the prototype of the neo-Fascist government which they seek to impose upon the world.


The big difference between my article and the CFR article is that the CFR article does not see the rise of China as a planned conspiracy, but rather as a purely coincidental consequence of the global financial disaster. Oh yes. Everything just coincidentally happened exactly the way the International Bankers that run the CFR planned. And all those investments pouring into fascists China over the last 30 years by Western Capitalists just happen to be the great beneficiaries. The Elite pretend to be nationalist for the benefit of the masses, as in the great pretenders Bush and Obama. But really they are supranationalists that only pledge allegiance to profits. And the type of fasco-slavery practiced in China is much more profitable than Western style Capitalism. Out with the old, in with the new.