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Death & Resurrection of the US [Federal Reserve]Dollar

A Review Article

by Adrian Salbuchi

October 15, 2006
GlobalResearch. ca

http://globalresear php?context= viewArticle& code=SAL20061015 &articleId= 3490

Analysts the world over are starting to recognize the
early warning signs of a gathering storm regarding the
strength of the international financial system in
general, and the stability of the United States
Dollar, in particular.

This essay provides an alternative view on this
impending crisis, written from the viewpoint of an
Argentine analyst whose country has undergone
recurrent monetary and financial crises over the past
forty years, albeit on a domestic rather than an
international scale.

Argentina experienced banking system collapses,
inflation, hyperinflation, public debt defaults, stock
market crashes and just about anything else you may
care to imagine in terms of financial and monetary
crises. Chronic inflation was so bad that since 1970
the Argentine currency – the Peso – was revamped four
times and had a total of 13 zeroes knocked off in
order to cope with inflation, the result being that
One Peso which today will just barely buy you a bus
ride in Buenos Aires City, is equivalent to 000 pesos from 1970, which at that time
would have allowed you to purchase the entire country
and left some change in your pocket.

In this country, we therefore have a lot of practical
first-hand experience on these matters and we believe
that we have much added value to contribute if we
apply our practical knowledge and experience to what
seems to be a cross-roads situation afflicting the
global financial and monetary systems.

Today’s financial turmoil rings a lot of familiar
bells to us and the sickly US Dollar is certainly
looking a whole lot like the old Argentine Pesos and
“Australes” of yore. Perhaps too, some lessons can
still be learned and the damage from these enormous
risks can be somewhat mitigated.

Adrian Salbuchi, June 2005[1]

Getting the Job Done

Last January, US President George W. Bush began his
second term in office by declaring foreign policy
objectives with clear imperial overtones that seem to
promise increasing violence and disruption on a
worldwide scale. Aside from the on-going illegal
military occupations of Iraq and Afghanistan, we can
most certainly expect other major crises and
convulsions of a military, political, economic and
financial character. One of these has specifically to
do with the use and abuse of the US Dollar as an
instrument of Imperial World Power by the Bush

In today’s “globalized” and “interdependent” world,
hi-tech applied to geopolitics, economy and finance
have transformed all of us into potential victims of a
vast number of virtual tsunamis which do not involve
oceanic waves but rather waves of technology-driven
social catastrophes, financial collapse and artificial
crises resulting in civil wars, external invasions,
genocides and collective disruption on a scale never
seen before. And even though these may be virtual
tsunami, the harm and suffering they cause are very

The world is on the verge of experiencing the
controlled destabilization and collapse of the US
Dollar, which will be replaced by a “New Dollar”
backed by Official “Good Gold.” The primary driving
forces behind this global process are the Bush
Administration allied to major private
financial-industria l interests in the United States
and elsewhere, focused on private Overworld
geopolitical planning emanating from a network of
think tanks, primarily the New York-based Council on
Foreign Relations.

The Controlled Destabilizing and Collapse of the US

“The King is dead! Long Live the King!” Such has been
since Medieval times, the cry announcing the demise of
an English Monarch and the immediate enthroning of the
chosen Royal Successor. If the US Dollar is the “king
of world currencies” and governs today’s usury-based
international financial system, it is no doubt an old,
decrepit, tired and sickly sovereign. Since the Empire
will never allow his throne to remain empty and
subject to unpredictable forces, we can be sure that
old and sickly King Dollar already has an appointed
blue-blooded royal successor, with rosy cheeks, golden
locks and solid health.

In a short while, the world shall hear loud and clear
an announcement declaring that “The Dollar is dead!
Long live the New Dollar!” Then, the Throne of Usury
in the temple of the god in whom the multitudes seem
to trust, shall usher in a new sovereign who will
enforce that centuries old creed, “business as

In recent years, the United States has driven and
presently maintains a gigantic and massive printing of
Dollar bank notes. No one seems to know for sure just
how excessive such currency printing really is, but
estimates put it somewhere between four to eight times
the monetary circulation that tallies with the size of
the US Economy (with a 2004 Gross Domestic Product of
almost u$s 13.000 billion).

The reader may ask how come we do not know what the
amount of Dollars in circulation really is? Well, this
is highly confidential information almost impossible
to discover mainly because, contrary to what most
people believe, the US Federal Reserve Bank (Fed) is a
private entity, even though the US Government may
exert some influence over it.2 --i.e., the public
institutions of Government cannot require the Fed to
render this information, especially when you consider
that the Chairman of the Federal Reserve Board, Alan
Greenspan need only inform Congress on a quarterly
basis what his monetary policy shall look like. We
would emphasize that he need only inform what his
policies will be, not seek instructions or consensus
or agreement from Congress or the Executive branch.

If we add to this the gigantic aggregates of
Dollar-denominated banking instruments and stocks &
shares which are spread throughout all world markets,
then this amount becomes almost incalculable. However,
it is quite clear that the sum total of Dollar bills,
Treasury bonds and bills, financial instruments of all
types, stocks and shares, and all kinds of public and
private financial instruments must equal a sum several
times more than the total sum of physical assets and
services available in the entire planet.3

In 2004, the US Budget Deficit was more than u$s
450.billion, while the Current Account Deficit
(foreign trade) was of around u$s 670.billion (i.e.,
more than twice and thrice, respectively, the size of
Argentina’s foreign public debt). Additionally, the
Bush Administration announced that both Deficits will
increase in 2005 and there are no indications that
this situation will improve in 2006, 2007 or 2008.
Quite the contrary, in November 2004 president Bush
asked Congress for authorization to increase the limit
of the US Public Debt from u$s 7.600.billion to almost
u$s 8.300.billion, which will be achieved by issuing
US Treasury Bills and Bonds, and printing more and
more Dollar bills by the US Mint.

The invasion and occupation in Iraq is estimated to
cost more than u$s 120.billion annually, to which must
be added the occupation cost of Afghanistan, the
direct financing by the US of the State of Israel’s
war machine, and the costs of preparing other future
war theatres, notably in Iran, Syria, North Korea,
Venezuela and other “axis of evil” countries. And we
better not even start thinking about the US’s
“greatest enemy” for the long term, i.e., China… Only
a few months back, president Bush got Congress to
support him with a further u$s 80.billion to cover
military costs in Afghanistan and Iraq and all
indications are that these military contingencies will
necessarily increase in both of these war theatres.

The sheer enormity of these figures can help us
understand why the US Federal Budget for 2004 of u$s
2.400.billion, suffered a shortfall of more than u$s
400 billion. There is, however, no indication
whatsoever that this shortfall will force the United
States to limit its war efforts in Iraq or
Afghanistan, or curb domestic social policies, or
freeze other war expenditures. Quite the contrary,
these are increasing them more and more. So, the
obvious question then is:

Where does the United States get the financial
resources it lacks to pay for all of this?

The answer to this question is quite simple: it raises
this money by printing US Dollar Notes and US Treasury
Bills and Bonds (5 and 30 year maturities,
respectively) , taking advantage of the high “export”
factor the Dollar enjoys, which enables the US
Government to issue money and immediately push it out
of its domestic economy and primary industrialized
country financial circuits, thus avoiding what would
otherwise be severe inflation of the Dollar. If we
look at the gigantic figures involved, we can quite
properly see this whole phenomenon as covert
(hyper)inflation which remains hidden from public
view….for now.

Fed Chairman Alan Greenspan recently warned that the
increase in the Budget Deficit could lead to an
economic crisis. He also pointed out that the Deficit
is unsustainable and warned that “this could lead to a
stagnant economy or worse”. Only in February 2005 the
Deficit reached a record monthly figure of u$s 113.940

The US Dollar: that un-backed currency…

“Who needs Dollars?” – Juan Perón

In 1971, President Richard Nixon withdrew the legal
foundations of the US Dollar’s convertibility into
metallic gold or silver, or anything else for that
matter. Since then, the Dollar is no longer
convertible into anything having any intrinsic value
whatsoever. Today, the cornerstone of the Dollar is US
economic and industrial strength which, in turn, is
based on the military might the US, consolidated after
the Second World War which left Europe and Japan
conveniently devastated. Additionally, military
victory brought with it the looting of hundreds of
thousands of German, Japanese and other national
patents and inventions, and highly sensitive
technological and military secrets were stolen
outright. All of this enabled the US to consolidate
its superpower status and global prestige5

Thanks to the fact that the Dollar has virtually
become the world’s key currency – albeit, imposed by
the combined actions of the Federal Reserve Bank
(Fed), the International Monetary Fund (IMF), the
World Bank (WB), the Bank of International Settlements
(BIS) and, in our own region, the Inter-American
Development Bank (IDB) – the United States has been
able to finance its Budget Deficits by exporting US
Dollars to the entire planet through various complex
mechanisms and channels that guarantee that those
Dollars and Dollar-denominated financial instruments
will flow in an orderly and balanced manner, all in
favour of US National Interests and that of its key
allies. This process could be kept more or less in
place until 2001 when the European Union launched its
own currency bringing the Euro on the scene. The Euro
is a far more solid and stable currency than the US
Dollar and represents a major challenge to the Dollar
which could very well unseat it as the preferred
global currency.

Over the past two years, the US Treasury Dept. and the
IMF have succeeded in suggesting/imposing on around
thirty national central banks in different countries –
Argentina’s Central Bank included – that they must
“soak up” US dollars from their domestic economies and
hoard these in their vaults as “reserves” for their
own local currencies and for foreign debt payment. In
other words, these countries invest in US Dollars
which implicitly means that they are financing for
free a chunk of (uncontrolled) US public spending
which is done by printing Dollar bills. This process
is headed by Japan which today has Dollar denominated
instruments in its central bank reserves to the tune
of over u$s 670.000.000. 000; strangely, followed by
the “Marxist” Peoples Republic of China with u$s 470
billion, then by South Korea with u$s 220 billion plus
a long list of other countries which suddenly awoke to
the “need” to “soak up” US Dollars and hoard them
silently in their central banks whilst they issue, as
a counterpart, their own local currencies to fuel
their respective domestic economies (something, by the
way, which China has been doing fiercely, maintaining
an undervalued Yuan much to the displeasure of the
Bush Administration) .

In the case of Argentina, this phenomenon helps shed
some light as to the true origins of our false
“economic recovery” which is basically due to the fact
that the Argentine Central Bank has issued important
amounts of local currency based on its Dollar
Reserves, which has suitably fueled economic growth.
This will work nicely until such time as Argentine
monetary authorities receive the suggestion /
counter-order from the US Federal Reserve Bank or the
Treasury Dept. to stop doing this. At present the
Central Bank has reserves for over u$s 22.billion and
rising fast, which is Argentine President Nestor
Kirchner’s pride, because with those dollars he can
pay our country’s basically fraudulent public debt
to…..the IMF, WB, IDB and other international
creditors, thus helping to keep the global usury ball

You want money? OK…. just print all you need!

Let me give a simple example of how the system
actually works. The Federal Reserve Bank issues a 100
Dollar bill which is given to the Bush Administration
so that the Dept. of Defense can give it to the US
Army who buy some ammunition for their soldiers’
rifles, who can then use it to kill iraquis in their
invaded land. Now, the last thing that the Bush
Administration wants is for that 100 Dollar bill to
flow back into the US financial system as that would
be potentially inflationary. Because the process we
described is repeated over and over again, millions
upon millions of times and allows the Bush
Administration to purchase not just ammunition, but,
more importantly, barrels of oil, tanks, F16
fighter-bombers, Apache helicopters, guided missiles
of all sorts, sizes and shapes, napalm, aircraft
carriers, cluster bombs and all those other much
needed instruments to promote “freedom and democracy”
throughout the world, the secret is to ensure that
these zillions of Dollar bills do not flow back into
the US economy uncontrollably. Otherwise, that would
have an inflationary – even a hyper-inflationary –

What the US Government needs and gets is that, once
each 100 Dollar bill the US Mint prints has been used
to buy war material (or whatever), that it then
gradually flows out of US domestic and primary
financial circuits and that it stays out for as long
as possible. I.e., that those Dollar bills eventually
get “soaked up” by somebody somewhere far away: in
Japan, Malaysia, China, India, Brunei, Saudi Arabia,
Brazil, Indonesia or Argentina. Anything, as long as
they make sure that those Dollars do not come back (at
least not anytime soon), into US financial circuits
and those of the primary supranational banking system.

From this point-of-view, we can well understand the
huge pressure exerted by the United States on foreign
central banks – especially those of subordinated
countries – so that they permanently “soak up” US
Dollars, which is equivalent to saying that they take
them out of circulation. That gives the US some
urgently needed respite and breathing space. Why does
the US need to do this, you may ask? Simple: so that
they can continue issuing as many 100 Dollar bills
they need, in order to give them to the Dept of
Defense who give it to the Army to buy some
ammunition….well, you know the story…. And the cycle
goes on and on and on….

By now you might be thinking that if you can get
others to pay for your expenses and costs like this,
then anybody can play at being a superpower. Well,
that’s precisely how the system works. If George W.
Bush needs money to finance his imperial appetite
(which has grown voraciously in recent years,
generating pathological and potentially catastrophic
Deficits), then, no problem: he need only ask Alan
Greenspan to issue all the Dollar bills he can spend;
in this way he gets literally “all the money in the

The key factor is to make sure that the spiraling
wheel keeps turning and churning and turning and
churning; printing, circulating, and then “soaking up”
those dollars through the channels and at the speed
which fit the Imperial need of ensuring they are
dispatched far, far away. The real danger is if the
wheel were to suddenly stop turning and churning
because then all this vast and complex global
financial engineering would simply collapse under a
huge load of worthless paper with the ensuing dire
consequences for our 21st Century Wizards of Oz.

For the United States to maintain global superpower
status, there must always be somebody somewhere as far
away as possible, on whom to dump vast quantities of
unbacked US Dollars, continually and uncontrollably
printed by the Fed so that once the US War machine has
consumed that money, it can be silently and discretely
removed from further circulation (i.e., “soaked up”
and hoarded in foreign central banks, private savings,
etc.). They need to make sure that these Dollars
“disappear” after they have been consumed; at least
for a while. And it really doesn’t matter whether they
“disappear” into central bank vaults abroad or into
individual investors’ safes and mattresses in Mexico,
Indonesia, Argentina, Nigeria or Brazil. That’s not
really the issue.

In short, every time one of us “foreigners” (or
“Aliens” as the US government sweetly calls us), buys
Dollars as savings, or our national central bank
“soaks them up” from domestic markets in order to
maintain whatever rate of exchange the IMF requires in
order to maintain a “sustainable economy” (Anne
Kruger, dixit) - i.e., so as to ensure that we can pay
back foreign debt loans - what we are really doing is
helping finance the US Budget Deficit. In the worst
case scenario, we are helping to pay for the cost of
killing iraquis and afghanis, preparing invasions
against Iran, Syria, North Korea or Venezuela, or
torturing POW’s in Guantanamo and Abu Ghraib.

This will enable us to better understand why in
countries like Argentina, successive caretaker
governments presided by the likes of former presidents
Carlos Menem, Fernando de la Rúa, Eduardo Duhalde and
Néstor Kirchner always bow down to help the US in this
way, through successive Argentine Central Bank
governors, notably in recent years, Messrs. Mario
Blejer, Alfonso Prat-Gay and, today, Hernán Martin
Péres Redrado6. Over the past three years, these
gentlemen have all implemented policies of “soaking
up” US dollars from the market in order to maintain
the rate of exchange of the Peso to the Dollar.

As a counterpart, these market-economy puppet central
bankers have had no problem in issuing Argentine Pesos
to buy Dollars in the local market and the IMF and US
Treasury Dept suitably applaud them for doing so.
However, if the Central Bank were to issue Argentine
Pesos to finance the building of our much needed
national social and strategic infrastructure, then all
“experts” and “media analysts” would go haywire to the
scream of “Inflation!” Why is it that these “experts”
insist that a 600 km four-lane highway is not proper
“collateral” for issuing local currency, whilst neat
piles of Dollars sleeping in the Central Bank is. Ah,
the mysteries of global finance…

May we once again stress that the real backing which
the US Dollar has nowadays is US economic strength, US
prestige and, above all, the immensely powerful and
apparently invincible armada of US military might
which, since 11th September 2001 is permanently
perched ready to attack, bomb and invade anybody
anywhere for any reason. Not bad as a “convertibility”
scheme: today, the US Dollar is convertible into
bullets, bombs and tanks, not to mention covert CIA
actions which could even include highly complex and
costly domestic terrorist attacks like 911 which
served as a casus belli for pro-israeli neocons in the
Bush Administration to declare war on the entire
world. Maybe someday we may know what really happened
on that clear morning of September 11th, though that
wont happen anytime soon…

In short and as a crude example of what we are saying,
every time the Argentine people need to buy a barrel
of oil, we must, as a community, work and toil to earn
u$s 57 to buy it. However, every time the US
government needs to buy a barrel of oil, it just has
to ask the Fed to print u$s 57. Clearly, there is a
great difference…

Again: like that, it’s easy be a global superpower.

Mafia + Usury = “Market Economy”

But, as the old adagio goes, “all good things must
come to an end”. And it would seem that with George
W. Bush the era of printing all the money you want is
fast coming to an end. In Argentina, we know only too
well what happens when you print “all the money in the
world” to pay for uncontrolled government spending.
Former president Raúl Alfonsín did just that and
collapsed the economy into 5000% hyperinflation in
1989 with the ensuing hunger, street riots, violence,
unemployment and suffering among the population.

Long before George W. made it to the White House, the
perverse process had begun whereby Finance and Money
which should always be subordinated to the Real
Economy of Work and Production went out of control and
– like a virtual tsunami – grew and grew into the
monster which is today. Swamping and drowning out the
Real Economy, destroying the forces of Labour,
deconstructing Production and generating mass poverty
and unemployment on a worldwide scale.

Indications of the geometrical swelling of this
tsunami are everywhere to be seen, even though local
and international so-called “analysts”, academics and
the specialized media do not seem to notice it. An
indicator of what we say can be found in the Dow Jones
Industrial Average (DJIA) Index. Right after the
collapse of the former Soviet Union, when George “It’s
the economy, stupid!” Bush Sr. lost the 1992 elections
to the young and upcoming Bill Clinton7, the Dow sat
placidly at 3.700 points. Eight years later, however,
when Clinton ended his second term in office in 2000
the Dow was at 10.900 points and had a short time
earlier peaked at 11.700 points; that’s 300% growth
over eight years!

The obvious question is: did the US economy also grow
300% between 1992 and 2000 as the DJIA did? The answer
is clearly, no. Economic growth in the nineties in the
US was very good but only averaged 3 to 4 percent per
annum, so that during the entire Clinton era aggregate
economic growth was not more than 40%.

Now, if the Real Economy only grew by 40% in eight
years, how is it that the “Virtual Economy” of Finance
and Speculation grew by 300%? Something is clearly
rotten and not exactly in the State of Denmark. The
key to all of this can be found in factors like Usury,
printing of Fiat money, and rampant speculation which
are embedded into the very fabric out of which today’s
global financial system is made of. Money is created
out of thin air by the Federal Reserve Bank and by the
private mega-banking system by the billions of

This all clearly carries with it a deep moral and
ethical problem as the real force behind the
“miraculous growth” of the US economy is “unlimited
greed” (Greenspan, dixit), soulless egotism and
homicidal profit-grabbing. In recent years, the stench
could no longer be contained nor checked. The criminal
frauds and inhumanities perpetrated by “world-class”
Fortune 500 Corporations and Banks hit the headlines
daily: Enron, WorldCom, Tyco, Nike, Marsh & McLennan,
American International Group, Wal-Mart, K-Mart, Arthur
Andersen, Halliburton (Dick Cheney), Harken Energy
(George W Bush), Pacific Gas & Electricity, Adelphi,
Qwest Communications, Global Crossing, amongst so many
others. Huge fines for money-laundering and corporate
misbehaviour were paid by top banks as CitiGroup
(money-launderers’ favourite bank), JPMorganChase,
Franklin National Bank of NY, Credit Suisse First
Boston, Morgan Stanley, Merrill Lynch, Goldman Sachs,
BCCI Bank of Commerce & Credit International (closed
down – linked to CIA), Brown Brothers Harriman (Bush),
HSBC (originally born out of the British imperial
Opium Wars fought against China in the mid-nineteenth
century which gives this bank great drug
money-laundering expertise)…

The list goes on and on, and this spirit of Usury and
Immorality spans the entire world: A-Hold in Holland,
Parmalat in Italy, The Maxwell Group in the UK, Yukos
in Russia, Vivendi in France… Their top corporate
bosses are investigated and even jailed: Kenneth Lay
(Enron), Bernhard Ebbers (WorldCom), Jeffrey Greenberg
(Marsh & McLennan), Maurice Greenberg (AIG)…

Again, we Argentines know what this is all about!!
We’ve had our share of corporate crooks in such
scandals as Yabrán, Beraja/Banco Mayo, Yoma, IBM,
CitiBank, Moneta, ENTEL, YPF, Southern Winds, not to
mention one billion dollars plus in Public Funds
belonging to Santa Cruz Province in southern Argentina
which mysteriously “disappeared” since 1993 when
president Nestor Kirchner was governor of that

The problem is that this whole process seems to have
been taken several steps too far, so now the whole
edifice is on the brink of collapse. The international
financial system resembles a planetary Las Vegas
managed by the Shylocks and Al Capones of this age,
who sit in corporate boardrooms in Wall Street, the
City of London, Paris and Zurich. They are starting to
realize, however, that their luck is definitely about
to run out. For decades they have danced themselves to
a dizzy frenzy around the Golden Calf, stuffing their
pockets whilst generating hunger, war, social turmoil,
sickness and suffering for untold millions around the
world. However, the “Game Over” sign is about to go

When Fed governor Alan Greenspan was asked in 1996 how
he explained the fact that the DJIA had reached the
unheard of level of 11.700 points, whilst the NASDAQ
index had peaked at 6.000 points (today it has slumped
to 1.600 points), his most eloquent reply was that
this whole complex phenomenon was caused by
“irrational exuberance”.. . You got it?

Just do it…

The truth of the matter is that the United States will
stay in Iraq and Afghanistan all the time it wants,
and will continue financing Israel limitlessly so that
it can continue repressing and persecuting the
Palestinian people in their own land, and new attacks
will be made against today’s expanded “Axis of Evil”
which - Condoleeza Rice, dixit8 - now includes North
Korea, Syria, Myanmar, Zimbabwe, Venezuela….

President Bush recently declared that he will continue
promoting “freedom and democracy” throughout the
world, thus honoring a shrewd recommendation contained
in an old book which is a true blueprint for world
domination, which recommends that Imperial Sovereigns
impose their will by exerting “Force and Hypocrisy”
Brute force we have plenty of just about everywhere.
Hypocrisy is constantly voiced by our presidents,
prime ministers, ministers, secretaries, government
spokesmen, media and corporate leaders. This gigantic
planetary machine needs oil to operate properly; lot’s
of oil. And not just the Iraqui, Venezuelan and Saudi
hydrocarbon variety, but also virtual “oil” which
today is the US Dollar which allows this infernal
machine to run, grow and spin out of control.

But, alas! The US cannot continue printing Dollar
bills indefinitely. Today’s global financial system is
bursting at the seams, and growing concern is marked
on the brow and voice of the Alan Greenspans of this
world. How much longer until there is a final crash?
One year? Two years? Nobody knows for sure. We do,
however, know that the US Dollar can collapse
virtually at any moment if an unforeseen /
unmanageable crisis were to arise.

This was one of the reasons why the plan to oust
Saddam Hussein had to be speeded up in 2003. Since
2001, Saddam had been selling oil in Euros to the
European Union under the Oil for Food Program,
implicitly inviting other OPEC (Organization of Oil
Exporting Countries) to do the same. Had this led to
the world oil market quickly switching over from
trading in US Dollars to trading in Euros as its base
currency, this would have had the effect of generating
an enormous, sudden and uncontrolled influx of US
Dollars from the whole world back into the United
States economy with immediate inflationary effects
which would have probably evolved into a
hyperinflationary catastrophe for the US. The invasion
of Iraq in March 2003 quickly dealt with that and
stopped Saddam dead in his tracks, at the same time
sending a clear message to all other oil producing
countries who may have been playing with the idea of
abandoning the “Dollar Area” in their oil tradings for
the Euro. “If you do that, you’ll end up like Iraq…”,
was the message, and nobody else did do that.

But the US also naively thought that invading Iraq
would be like a joyride, that the proud Iraqui people
would welcome the US invaders as liberators, and that
a quickly subdued Iraq would speed up massive cheap
oil flows from their oil fields to US gas stations at
a cost of not more than u$s 15 per barrel, which would
have certainly eased the pressure on the US economy.
But things did not quite turn out that way and the
“cheap oil” objective was never reached. Today, Iraq
is looking more and more like Vietnam whilst world oil
prices have reached u$s 57.60 a barrel and rising.
This forced the Bush Administration to take such
emergency actions as, for example, opening up vast
virgin natural reserves in Alaska to the contaminating
oil industry. The US economy’s voracious addiction to
oil is very much out of control.

Today, excessive printing of US dollars has passed the
point of no return. Monetary collapse can no longer be
avoided. At best, it needs to be managed. Naturally,
the US elite power Establishment and its key allies in
the United Kingdom and the State of Israel are not
stupid and they will not allow a hyperinflationary
crisis to collapse their economies. There are various,
creative and innovative ways of re-directing and
detouring monetary catastrophes so that they hit
somebody else somewhere else, and there are ways of
ensuring that damage control at home and at our
friends’ homes is kept at acceptable levels. It is
precisely this “Plan B” which is presently on the
drawing boards in the key think tanks headed by the
New York-based Council on Foreign Relations, the
London-based Royal Institute of International Affairs,
and the Trilateral Commission.

It even appears as though “Plan B” consists of letting
the present mass of US Dollars continue growing for a
bit longer, all the way up to the brink of collapse,
taking advantage as much as possible of the fact that
this serves to ensure that the rest of the world
finances the US Budget and Trading Deficits. The first
part of Plan B, then, consists of making sure that the
party lasts as long as possible, fueling all on-going
military adventures.

We would even say that just a George W. Bush’s main
purpose during his first term was to serve as a
suitable figurehead for the “War on Terrorism”, his
primary purpose during his second term in office will
be to lead a highly professional team which is taking
advantage, promoting and managing the very complex
monetary and financial engineering necessary for the
demise of the Dollar, then ensuring its orderly
replacement by a New Gold-backed Dollar.

Let us consider a possible scenario of this sort.

The “New Dollar” is coming!

“Plan B” has a second part. Sometime during the next
12 to 24 months, our TV screens will tune in to CNN,
CBS, BBC, CNBC, Fox and other world media as they
announce urgent “Breaking News” involving important
financial developments amid growing panic and dark
rumours. Such news will come on a Friday afternoon,
after 4 or 5 PM when the New York Stock Exchange and
banks in New York City have closed. We will learn that
Alan Greenspan – probably accompanied by Treasury
Secretary John Show – have a very important
announcement to make to the people of the United
States and the world. His speech will be short, terse
and filled with carefully selected banking jargon.

Greenspan will state something along the lines that
“in an effort to uphold and reinforce the US economy
and that of its key allies; to protect consumer
interests and those of major corporations; to preserve
the international financial system and to thwart a
potential financial meltdown; to balance the Budget
and avoid a stock market collapse, the United States
will effective immediately implement a far-reaching
Economic Reform and Financial overhaul, declaring an
extended banking and exchange holiday”. In Argentina,
we have lot’s of experience on this!.

He will then inform that President George W. Bush,
with the full support of Congress, will sign a series
of emergency executive orders whereby the US Dollar
will be placed on a Gold Standard. Correspondingly,
this will necessitate introducing a New Dollar
convertible into metallic gold and this new currency
shall replace all the “old dollars” in circulation
which, as we have seen, are only backed by worthless
paper, i.e., Fiat money. What’s going to happen with
those “old” dollars? They will have to exchanged for
New Dollars, of course.

All persons holding US Dollar Notes and Treasury
instruments who are citizens of the US or are
domiciled in the US, together with US corporations,
and persons, corporations and organizations domiciled
in countries allied to the US (most notably, the
United Kingdom and State of Israel) shall have their
“old” Dollars exchanged for New Dollars on a 1-to-1

In the rest of the world – i.e., Asia-Pacific, Central
and South America, Africa, Russia, the Muslim World –
changing “old” Dollars for New ones will depend on the
local “exchange markets” which will fix the “proper”
rate of exchange between the extremely plentiful “old”
Dollars and the extremely scarce New Dollars. And what
will that rate of exchange be? One-to-one? I doubt it,
because supply and demand will set in almost as fast
as panic. Two “old” Dollars for One New Dollar, then?
Or, maybe, 3-to-1? Or 5-to-1? Or 10-to-1? Who knows?
“Let the laws of the free-market economy – supply and
demand – do their bidding”. And whatever happens
elsewhere will certainly not be the concern of the US.

We will then see millions upon millions of desperate
and panicky people, companies, banks, operators,
players of all sorts throughout the planet running
amok all at the same time trying to unload their “old”
Dollars and exchange them for New Dollars. Again, in
Argentina we have a huge amount of experience on this…

Alan Greenspan is definitely the man to micromanage
this whole process, with the political support and
backing of president George W, Bush, because he has
always been a Gold Standard buff, since a long, long
time ago. One of his first key academic articles
dating back to 1967 proposed just that: placing the US
Dollar on a Gold Standard.

And then along came the Euro…

Another key factor which helped trigger and speed up
this impending crisis was the launching in 2001 of the
greatest challenge to the Dollar so far: the Euro. As
the monetary unit of the European Union (EU), the Euro
carries the economic might of an entire continent with
a combined GDP which is almost the same as that of the
United States. Powerful stuff, indeed.

If we project future growth of both economies over the
next twenty years, we find that the EU economy has
greater potential than the US economy simply because
the countries surrounding the UE are anxiously asking
to be allowed into this vast and sophisticated
economic and monetary system which in the long run
will probably end up including even Russia itself.
Each of the countries still outside the UE – Ukraine,
Belorussia, Lithuania, Estonia, Latvia, Hungary and
others – have great added value to contribute to the
UE economy, both in terms of the economy, as well as

By comparison, the US can only expand its regional
economy into Central and South America, where the
countries in that region resist aggressive US
penetration and, for more than a century, resent
arbitrary US military interventions, invasions and
repeated humiliations.

Quite a difference! Whilst the countries still to join
the UE wish to do so voluntarily and anxiously await
their turn, the US has no choice but to impose AFTA
(American Free Trade Agreement) on unwilling
neighbours that will permanently resist the regional
hegemon. More importantly in the short term, there are
a series of symmetries and asymmetries between the
present Dollar and the Euro worth pointing out:

Comparison between the US Dollar and the Euro

Structural Strength (Technical Factor)

Low: The Dollar is over-issued by a factor of 4 to 8
times (there being no trustworthy information
available), because over the past years successive US
administrations have abused the Dollar’s high prestige
and printing has gone out of control; Growing evidence
of this structural weakness generates inflationary -
even hyper-inflationary - risks which can be triggered
by some internal or external political or financial

High: The Euro has only been just launched (2001). The
European Central Bank in Frankfurt Germany issues
clear public information showing that the amount of
currency placed in circulation since 2001 is
consistent with the size and productive capacity of
the UE economy. No doubt, the Euro runs no
inflationary risks at the present moment.

Cultural and Psychological Strength

Very High: Intelligently, the US has kept the same
format (i.e., the same national leaders, monuments and
mottos) on its Dollar bill for more than a century.
This gives the Dollar a feeling of unmovable
stability: the effigies of Washington, Lincoln,
Hamilton, Jackson, Grant and Franklin appear on 1, 5,
10, 20, 50 and 100 Dollar bills together with symbols
of US power: the White House, the Treasury Department,
Congress, the Lincoln Memorial, the Great Seal of the
US (with its esoteric, Masonic and millenarian
symbolism including the pyramid topped by the
all-seeing Eye of the Great Architect of the Universe
ushering the Illuminati New World Order announced
since 1776).
Each Dollar bill bears the credo “In God we Trust”,
although people increasingly wonder what “God” the US
government is really talking about…

Low (still): The design chosen by European monetary
authorities for the Euro is rather unfortunate. No
doubt, finding consensus amongst fifteen countries was
not an easy task. The Euro is bland, insipid and
uninspiring, bears the sole word “Euro” and shows
gates and bridges which rather than depicting real
monuments merely reflect abstract architectural
styles. Clearly, the Euro is an oxymoron designed by a
committee, which brings to mind what our former
president Juan Perón once said to the effect that “a
camel is a horse designed by a committee…”. And a
camel is what the Europeans got… The Euro contains no
compelling symbols, which is something almost
incredible coming from a continent having some of the
most beautiful monuments in the world which could
easily serve as very powerful symbols: the Roman
Coleseum, the splendid cathedrals of Rheims or
Cologne, the Parthenon of Athens, the Alcazar in

In short, the Dollar is a structurally weak currency
with enormous psychological strength and prestige,
whilst the Euro is a structurally strong currency with
substantial cultural weakness. Today, the US Dollar
resembles those high-class families of yore which,
having lost all their wealth, nevertheless maintain
their noble appearances and pride. So much so, that
people continue respecting them as if they still were
powerful and rich lords. When reality finally catches
up with the Dollar, its collapse could come quickly
and violently. Meanwhile, the Euro can continue to
mature solidly as long as the monetary, financial and
geopolitical structures of the EU move forward.
Clearly, in monetary affairs time runs against the US
and in favour of the EU.

And then there’s China. In a few years more, the most
powerful economy in the world will be the Chinese
economy and on top of that they are a nuclear power.
With its two-currency and capitalist-socialis t system,
China has succeeded in implementing some of the
fundamental concepts involving the use of Sovereign
Currency – by way of the Yuan – to promote enormous
internal development and growth. No doubt, in the long
run, what really gives the US-UK-Israeli Empire
leadership sleepless nights, is China.

One last comment for this section: in the Table above,
we describe the great cultural strength of the US
Dollar which has hardly been altered over the past
century. Significantly, in recent years – and for
reasons not yet clearly explained – the Federal
Reserve Bank decided to begin slightly altering the
physical appearance of the Dollar. The effigies of
Franklin, Grant, Jackson, Hamilton and Lincoln were
slightly displaced to the left and enlargened,
security factors were introduced and, most notably,
various color experiments changing the traditional
green and black colors were also introduced. It began
some years back with a new series of blue-coloured 20
Dollar bills, then came later red-coloured u$s 50
Dollar bills, thus breaking the traditional “green”
tradition for which the dollar is known the world

Might this be a way to prepare the collective psyche
for the “great change” that will take place when the
New Dollar is finally and suddenly introduced at the
same time that the old dollars are withdrawn from
circulation? It is hardly necessary to remind readers
that general acceptance of any currency is basically a
social convention which thus carries a decisive
psychological factor. All Nation-states know that
acceptance of its currency – inside and outside of the
country – depends on factors which need to be properly
linked and tuned to the collective psyche, and which
have to do with the Trust and Prestige emanating from
the issuing agency. And this Trust and Prestige is not
so much geared on a particular government
(Administrations come and go), but rather on the
strength of the issuing Sovereign Nation-State (which
should permanently consolidate and increase its
Power). Very possibly, the New Dollar shall have a
totally different design than today’s Dollars. It may
even be of different colours and sizes.

Bases for a New Dollar.

These are relatively simple and can be described as

A Monetary Unit convertible into Gold at an official
and mandatory rate of exchange fixed by the US Federal
Reserve Bank, in coordination with the Bank of England
and key supranational public and private financial

The Gold backing the New Dollar will not be just any
gold. Only special “officially approved New Dollar
Gold Bullion” will be used and accepted, which will be
specially minted and proof. It will no doubt carry an
embedded chip or bar code or some other foolproof and
failsafe anti-counterfeit element, ensuring total
control by the monetary authorities.
“Common” gold – i.e., non-officially approved and
treated gold, will be worth maybe three, five or ten
times less than the Special Approved Gold Bullion.
This “Good Gold” is in all likelihood already being
minted and amassed in the vaults of the Federal
Reserve Bank in New York, the Bank of England in
London and elsewhere.

You may be thinking that this will trigger a gigantic
worldwide financial crisis. No doubt, it will. That
this will place the better part of the international
financial system on its head. Of course it will. That
there will be even more hunger, hardship, poverty,
sickness, wars, epidemics and catastrophes of all
sorts. Certainly… However, those who are “in the know”
beforehand – i.e., the Empire’s most trustworthy
allies and friends (both in terms of countries as well
as financial, economic and industrial groups and even
a Mafia here and there) in the US, the UK and Israel –
will receive all the necessary foreknowledge enabling
them to mitigate the impact of this crisis and make

In Argentina we remember only too well own domestic
monetary and financial meltdown in December 2001. The
private banks and certain key individuals who were
“well informed” got their money out of the system in a
timely manner and when the crisis came, it was the
populace at large that bore the brunt. The banks and
major corporations came out surprisingly unscathed and
today they are for the most part back to “business as
usual”, whilst more than 50% of the population sank
below poverty levels.

China, Japan, India with their vast reserves will feel
the blow. They will loose vast amounts of money. Japan
will see its economic recovery delayed for years to
come. China will see it huge growth slowed down, the
aggregated effect of the global financial collapse
will greatly harm exports from India, Taiwan, South
Korea, Brazil…

China herself seems to be making ready for this, as
they are already transforming great chunks of their
Dollar-denominated reserves of more than u$s
470.000.000. 000 – in “old” Dollars, of course– into
physical assets (i.e., investments in South East Asia
and in South America, and they are shedding dollars
and buying Euros). Japan and South Korea cannot budge
as swiftly and easily because they are military
underdogs and politically subservient to the United
States. To a great extent, their lots have been cast
unless…. Unless, as Samuel Huntington insinuated in
his 1997 classic “The Clash of Civilizations” , Japan
and China were to forge an alliance similar to the one
which Germany and France were able to reach over half
a century ago.

Imagine Japanese technology allied to the Chinese
powerhouse and its military clout… Then South Korea
might even be able to move forward towards
reunification with the North under the aegis of China
which wields the necessary influence over the North
Koreans and can soften up their outmoded authoritarian
style. This latter scenario most definitely keeps the
US-UK-Israeli imperial leaders wide awake at night…

The “controlled collapse of the international
financial and monetary system” is the next “Great
Crisis” which the Real Power Structures of the New
World Order have entrusted to George W. Bush and his
team, knowing that they have the necessary
psychological profile to promote this virtual fraud
and robbery on an unprecedented planetary scale. The
whole world has witnessed speechlessly at the
incredible audacity with which George W. Bush and his
team look into the TV cameras and blatantly lie
without a blink in their eyes.

In this brief essay, we have described a possible
future scenario, resulting from a series of technical
factors (the extreme over-printing of US Dollar bank
notes and Treasury bills and bonds), economic
interests (mainly the Empire’s wish and need to have
free access to major oil fields around the world), and
long term US-UK-Israeli geopolitical objectives (in
the Middle East, in the short/medium terms; in South
America, in the medium term; and in the Far East, in
the long term). If we add to this the Empire’s hunger
for conquest, triggered and “justified” by the strange
events of September 11, 2001 then we feel that the
scenario described herein is not only possible but
also probable.

Implications for countries like Argentina are
enormous, for this will entail great threats of all
sorts, but also unexpected opportunities as well. For
example, why does the present Argentine government
make such unsustainable and unrealistic efforts to
“renegotiate” our huge Dollar-denominated foreign
debt, when a collapse of the “old” Dollar could very
well carry with it the virtual liquidation or, at
least, vast reduction of that public debt?

Clearly, there is much food for thought in all of
this, and many lessons to be learned from the past.
Whatever may happen, if you have a large part of your
assets in US Dollars – whether in bank notes, Treasury
Bills, stocks and shares, investment funds, banking
accounts or whatever - perhaps you would be wise to
reconsider. In the coming collapse of the
international monetary system, the safest thing to do
will be to invest in the Real Economy and not in the
unreal financial economy. In other words, consider
buying tangible goods: real estate, companies,
machinery, land, equipment, precious metals and
stones, and the like. No matter how bad an economic
crisis may be, tangible goods will not disappear
whilst the balance on your bank account appearing on
an ATM screen can quickly vanish into nowhere. Oh, and
don’t forget: paper money is just that: paper.

Think about it..


1 Adrian Salbuchi is an Argentine writer, researcher
and journalist. Member of CREAR, Consejo Regional
Estratégico Argentino, the Project for a Second
Argentine Republic and the Centro de Estudios
Económicos Mariano Fragueiro, Buenos Aires. Author of
various books on geopolitics and economics, amongst
them, “El Cerebro del Mundo: la cara oculta de la
globalización” (Ediciones del Copista, Córdoba,
Argentina, 4th Edition, 2003, 470 pages).

2 More than 95% of the Federal Reserve Bank’s share
capital is owned by the private member banks, which
can, in turn, be traced back to key traditional
finance dynasties, both in Europe and in the US:
Rothschild, Warburg, Schroeder, Mellon, Bleichroeder,
Montefiori, Montagu, Rockefeller, and Harriman,
amongst others. Cfr. The Federal Reserve Bank,
Purposes & Functions, Washington DC.

3 The sum of all international financial operations
(exchange, stocks and shares, investment funds, etc)
is of almost u$s 000 daily (yes, daily).
If this is projected annually, we find that the
internacional financial system (i.e, the Virtual
Economy) has a turnover of around u$s
700.000.000. 000.000 (seven hundred trillion Dollars),
however, the aggregate sum of the GDP’s of all
countries in the world (i.e., the Real Economy) does
not exceed u$s 000, i.e., an amount
fifteen times smaller. We can thus conclude that
Internacional Finance – the world of speculation,
usury and fiat money – is fifteen times larger than
the Real Economy of Labour and Production. If finance
is to be considered as the “oil” which makes the
Economic “engine” run, then we can see that that
“engine” is overstuffed with a veritable oil glut
which will grind it to a halt.

4 See “Clarín” newspaper, Buenos Aires, 15-Mar-05,
article “Greenspan encendió una luz de alerta por el
déficit de EE.UU”.

5 Regarding the nature of Power, I would refer readers
to my essay “El Poder: ¿de dónde viene?, ¿quién lo
tiene?, ¿adónde va?” (“Power: where does it come from?
Who has it? Whither is it going?” soon to be
translated into English), available in

6 Before being named president of the Argentine
Central Bank under the De la Rúa and Duhalde
Administrations, Mario Blejer was for 18 years
director of the Institute for Monetary Affaire at the
IMF in Washington DC and today he is Director of the
Bank of England in London. Alfonso Prat-Gay, president
of the Central Bank during the last part of the
Duhalde administration and first part of the Kirchner
administration was a director at J P Morgan
Investments, London and he was “recommended” to the
Argentine government by the Bank of England based on
Blejer’s suggestion. Hernán Martín Péres Redrado, the
present Central Bank president comes from the
Fundación Capital, idelogically linked to the extreme
liberal policies of former president Carlos Menem.
7 Member of the Council on Foreign Relations and the
Trilateral Commission.

8 Secretary of State and member of the Council on
Foreign Relations.

Note: This article was translated from the Spanish

© Adrian Salbuchi, Buenos Aires, 05 June 2005
Reproduction allowed if the source is clearly named.

Disclaimer: The views expressed in this article are
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