Apr 152023
 April 15, 2023  Posted by at 11:55 am Finance Tagged with: , , , , , , ,

Brian Griffin Memorial to the Conquerors of Space, Moscow, Russia 1974




Andrew Korybko:


Brazilian President Lula was successful in reaching an agreement to de-dollarize his country’s trade with China, the significance of which was earlier explained in the context of his country’s grand strategy here, but failed to convince his counterpart to join a so-called “peace club” on Ukraine during their summit. This is no small shortcoming either since it was promoted by his Foreign Minister as one of the reasons behind his trip in an interview that he gave to the Financial Times (FT) late last month.

Globally prominent outlets such as Bloomberg, France24, the US Government-run “Radio Free Europe/Radio Liberty” (RFERL), and others all accordingly reported that this issue would be high on the agenda during Lula’s talks with President Xi. His supporters on social media also went wild getting everyone’s expectations up about this as well, even though “Brazil & China Are Poles Apart When It Comes To Their Envisaged End Games In Ukraine” so it was never likely that anything would come of this.

While China, India, and South Africa have consistently abstained from anti-Russian UNGA Resolutions, Brazil bucked the BRICS trend by always voting against Russia except when it came to suspending it from the Human Rights Council. Lula became the first BRICS leader to personally condemn Russia in his joint statement with Biden back in February, after which he ordered his diplomats to vote in support of the latest anti-Russian UNGA Resolution later that same month.

Foreign Minister Vieira was obviously well aware of the sharp differences between Brazil and China’s officially envisaged end games to this conflict yet he still made it seem to FT like there was a chance that the People’s Republic would tacitly support his country’s position via participation in the “peace club”. That was nothing more than wishful thinking, which belied Brazilian diplomats’ refusal to acknowledge China’s principled approach to this conflict since they in hindsight seemed to assume that it was flexible.

Reality slapped them and their supporters in the face upon the publication of the joint Brazilian-Chinese communique on Friday, which can be read in English on the official website of the Brazilian Ministry of Foreign Affairs here. The ninth paragraph of that document will now be shared in full so as to prove Lula’s failure to sway President Xi to his country’s side contrary to the unrealistic expectation that Vieira set for his trip when talking to the FT late last month:

“Both parties stated that dialogue and negotiation are the only viable way out of the crisis in Ukraine and that all efforts leading to a peaceful solution to the crisis must be encouraged and supported. Brazil received in a positive way the proposal by China that offers reflections conducive to the search for a peaceful solution to the crisis. China received in a positive way the efforts by Brazil in favour of peace. The parties made an appeal for more countries to play a constructive role in the promotion of a political solution to the crisis in Ukraine. The parties decided to keep in contact on this matter.”

As can be seen, absolutely nothing of tangible significance came from Lula’s over-hyped “peace club” proposal. This paragraph of their joint statement is purely perfunctory and simply acknowledges their shared interest in peace without touching upon their sharp differences in terms of how this should be achieved. The “positive way” in which China “received” “the efforts by Brazil in favour of peace” is similar in spirit to Russia’s reported support of the optics connected to Lula’s peace rhetoric.

What’s meant by this was explained more in detail here last week but just refers to Russia and China’s interest in showing the world that the international community wants peace as soon as possible instead of indefinitely perpetuating this proxy war. Their soft power interests in no way even remotely imply endorsement of Lula’s envisaged end game as articulated in his joint condemnation of Russia with Biden and the anti-Russian UNGA Resolution that he ordered his country’s diplomats to vote in support of.

China wasn’t ever going to be manipulated into de facto taking the US’ political side in this conflict against Russia by dint of joining Lula’s “peace club” and thus extending credence to his hostile demand that their shared BRICS partner immediately withdraw from all the territory that Kiev claims as its own. Doing so would have discredited President Xi’s signature peace proposal that his diplomats unveiled on the one-year anniversary of the conflict and which he discussed at length with President Putin in March.

Lula therefore failed in his function as Biden’s “Trojan Horse” for tricking the Chinese leader into informally adopting an anti-Russian policy, but this unfriendly gamble didn’t spoil their much larger success in agreeing to de-dollarize bilateral trade. About that, while it’s indisputably a positive development that’ll accelerate the global systemic transition to multipolarity, his Finance Minister Fernando Haddad made it clear that neither this nor the trip in general were aimed against the US.

In his own words, “It doesn’t make sense to get closer to China and move away from the United States. We want the best relations with the United States and the European Union.” This aligns with the insight that was hyperlinked to in the introduction regarding Brazil’s grand strategy, which was elaborated upon in this piece here from Friday that discusses the significance of Lula’s reported plans to launch a global influence platform in joint partnership with the US Democrats.

To summarize, he believes that Brazil can “balance” – however clumsily and imperfectly – between de-dollarizing with China and aggressively propagating liberalglobalism across the world with the US, thus enabling his country to preemptively avert potentially disproportionate dependence on either. Relations with Russia are limited in this paradigm to commodities (including energy investments) and cooperation on BRICS’ new reserve currency, which are important but pale in comparison to China and the US’ roles.

All told, the grand strategic significance of Lula’s de-dollarization success with China far outweighs his failure to trick it into tacitly adopting an anti-Russian policy by joining his proposed “peace club”, but the second-mentioned outcome still deserves to be discussed. Those who expected this to happen must cogently account for the fact that it didn’t occur, though without resorting to the conspiracy theories that have become popular among his supporters, if they want to retain a semblance of credibility.




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Home Forums Lula: Peace Club to De-dollarization

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    Brian Griffin Memorial to the Conquerors of Space, Moscow, Russia 1974       Andrew Korybko:   Brazilian President Lula was succes
    [See the full post at: Lula: Peace Club to De-dollarization]

    D Benton Smith

    Life for those caught in the middle must always be a precarious balancing act. I have a general impression that Lula is ideologically more aligned with the insane masters of the West in Woke Washington, but he is pragmatic enough to recognize his bread is going to be buttered in the future by his ruthlessly pragmatic (and yet far saner) masters in Beijing. I don’t like Lula (or Beijing) but at this juncture in history I’ll side with both of them (temporarily, I hope) against the batshit crazy Luciferian monsters currently running the dying Empire of Perversions from America.

    If our North American nation is ever to recover from its diabolical fever dream (and there are certainly no guarantees in that regard) it must begin with the overwhelming defeat and permanent disbarment of those rabid idiots inside the Beltway.


    Yeah, the Dollar is integral to all the other things currently in play – geopolitical, cultural, ideological etc. I don’t think you can de-dollarize and keep the other stuff.

    Blackrock. Biggest owner of Budweiser (well, Anhauser-Busch)

    Blackrock, buying up all the homes so working and young people can’t own a home, start a family (“household formation”)

    Blackrock and Vanguard, biggest owners of my former employer. Just so happened to fire me for not taking a negative-effective definitely harmful still experimental injection. Check ownership of corporations making similar decisions

    These corporations, whether they are ruining a nation, a segment of the economy, themselves, or star wars, seem to be standing under a neverending waterfall of dollars that makes anything their customers want, anything that would make any sense, reality itself, irrelevant.

    CEO for Budweiser – a former CIA recruiter. huh.

    The head of Bud advertising – went to a $65,000/year boarding school, then Harvard & Wharton School. She came from where all the assholes are coming from, continually pooped out of these places due to an endless waterfall of dollars they are standing under. Probably never made anything nor performed a service that a real person would willingly give up their money for in her life. May have never received real criticism of herself outside the abstract realm of ideology. So there’s an infinite waterfall of dollars to pour on her OF COURSE how could it be otherwise.

    Look at what happened with Covid. Doctors aren’t doctors anymore. They are obedient bureaucrats. Journalists aren’t journalists, etc. Apparently, you can always find ENOUGH humans to be stupid assholes endlessly so long as you pay them 6 figures. Anything to get/maintain that.

    Same with nations. You let in all the demoralizing/destabilizing cultural influences, the same astroturf, you end up doing what you’re told or get a color revolution and do what you’re told. Resort to bitcoin or gold? A financial instrument gets invented for it, dollars get printed, and it gets bid down or fast crashes can always “unfortunately” happen on the instruments that end up determining price of the thing. There is nothing you can store value in for safety from the printed dollar that cannot be de-valued by even more printed dollars, apparently.

    Honestly, I’m perplexed at why the CIA even engages in all their society-ruining activities like drugs and human trafficking. Can’t you simply PRINT all the shit you need at this point? wtf? Leave us alone to make things work then.

    Like, couldn’t everyone in a position that matters just print all the shit they need, buy some oceanfront property, and retire to a life of ease and luxury right NOW and stop interfering with all the civilizational processes that actually provide the luxuries? Like, fine, we will support you, IT IS WHAT WE ARE ALL DOING ANYWAY, but if you could just stop making it more DIFFICULT to do so, that’d be something. Like you think making us miserable and making it more difficult to provide you with the goods and services you could never provide for yourself is big-brain smartypants superior stuff. Can you let us go ahead and carry you on our backs for just a sec without INTERFERING with the job???

    So the dollar dies, nations refuse whatever replacement is offered, and stop getting fucked with. Hard choice, I see why Brazil would waffle on this.

    I realize, as an American, I’ve “benefitted” from dollar hegemony. I’m enjoying all the “benefits” of having my manufacturing jobs disappear so I can use my diminishing dollars to buy shoddy products from China.

    Like the 8+ hours of frustrating plumbing I got to do this week. On a simple replacement of a j pipe under a bathroom sink. I’ve done a bunch of these before. I’ve replaced garbage disposals, washer connections, various similar things as well. Haven’t done it in a few years. THIS time, there are continual leaks throughout the assembly – of parts that were MADE to fit each other. Slathering the junctions in plumber’s tape and plumber’s putty, trying different types of washers, gaskets, patiently taking apart and reassembling with a leak cropping up in a different place with every new attempt.

    This is not a product, this is an evocative representation OF a product. Same with practically everything on amazon. The reviews lie, you get a product that is kinda sorta a thing, but not really. Just give up on stuff. Thank goodness I am an American and benefitting. Running water isn’t a lowest level basic staple of civilization or anything, so I shouldn’t complain about my continually experienced “Benefits”

    Or all the endless dollars that clearly poured into buying all the housing so I cannot own a home, the dollars that have benefitted me by pouring into US Elections, the dollars that pour endlessly into every social/political/cultural aspect of my society’s Commons in such a helpful way. Dollars are free speech, and I’ve benefitted from that free speech in everything from bank bailouts I didn’t want to required injections I didn’t want. Thank you, dollar. Every aspect of your existence surely benefits Americans and we’re destined to suffer if you ever go away.


    It is Twentysomethings who see the new paradigms not Eighty-year-olds. The proxy WWIII in Ukraine is clearly about the birth of the tripartite world that could well become a human extinction event unless one is in denial or is too old.

    Saudi Arabia’s switching sides signals the end of the western hegemon with the US dollar as the reserve currency. From this point on, over half of the world’s trade will be conducted in other currencies. Any future issuing by the FED of digital dollars to fight an economic depression will be pointless because the US dollar is supported only by the finite wealth, labor and resources of 43% of North America. This is livable, but it requires planning, sharing, common sense and the rule of law – a constitutional democratic republic. These all vanished with the Reagan/Thatcher counter revolt that founded the current neo-liberal, robber baron, world.

    The proxy world war will continue until one side (or both) collapses just like the first world war. The only way out is a peace treaty and building a DMZ between Ukraine and Russia this summer. OG’s leaks show the split in USA within the people, between the government agencies, plus the ideological incompetence of the White House that keeps this war going on and on.


    For this article, when I refer to Eurocurrency, I’m not referring to the Euro(€). Since 1950 bank accounts that were denominated in a foreign currency had “euro” attached to the front of their names, for example:
    • Offshore Dollar = “Eurodollar”
    • Offshore Guilder = “Euroguilder”
    • Offshore Yen = “Euroyen”
    • Offshore Euro = “Euroeuro”

    Since a currency is only valid within its legal jurisdiction, the euro/offshore versions are just “claims” on the original. Therefore, Eurodollars are not dollars; they are just claims on dollars.

    The US Dollar has NEVER been the global reserve currency. From about 1950, the Eurodollar has expanded to become the actual reserve currency, and the US Dollar just happens to be “pegged” to the Eurodollar.

    The Eurocurrency system is now the focal point of the international market for short-term and intermediate-term credits. It carries out the following primary functions:
    • Clearing for international payments
    • Hedging forward against exchange risk
    • Commercial banks in each country accept deposits from locals and foreigners, but only in that country’s currency. This system can then offer short-term loans for trade finance purposes.

    For example, Japanese banks accept Yen deposits and make Yen loans, American banks accept dollar deposits and make dollar loans, and so on. To finance foreign trade for their customers, these commercial banks can quickly obtain spot or forward foreign exchange in the international interbank market or draw on balances of foreign currency held with correspondent banks abroad.

    Before the 1950’s international trade was dominated by traditional foreign exchange banking, which handled letters of credit and the exchange of currency “A” for currency “B.”

    Due to historical reasons, the Eurocurrency banking system primarily resides in the City (aka the City of London). An essential fact to understand is the City of London (the one square mile) is a separate legal entity from London proper.

    During the 1960’s traditional foreign-exchange banking coexisted with the emerging Eurocurrency offshore market:
    • Traditional foreign-exchange banks face stringent regulations
    • Offshore Eurocurrency banks are lightly regulated, if regulated at all, depending on the jurisdiction

    Therefore, on an international scale, offshore unregulated financial markets compete with onshore regulated ones. Today, offshore Eurocurrency Banking, primarily located in the City, dominates global trade.

    For the Unipolar world to exist, it needs the Eurocurrency System. CBDC is about bringing “Eurocurrencies” in from offshore and legitimizing them as legal tender.

    The Multipolar world wants to revert to traditional foreign exchange banking.

    The euro/offshore system is based on debt, its lifeblood. The debt market’s depth, size, and liquidity drive the actual valuation between currencies within this system.

    The traditional system valued the following when comparing currency areas:
    • Goods – things a county makes.
    • Services – Services offered by a county.
    • Commodities – basic materials.
    • The monetary base – precious metals, foreign currency reserves, etc.

    We are at a tipping point today. The world will either fall forward into a brave new world of a single global currency based on the euro/offshore/debt system, or it will pull back and return to a traditional system based on goods, services, commodities, and the monetary base.

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