Kick
Russia Out Of SWIFT, UK Demands
29
August, 2014
UK
Prime Minister David Cameron came out swinging this morning; not only
at ISIS but in calling
for European leaders to block Russia from the SWIFT banking
transaction system.
European leaders have already (via unnamed sources) denied any actual
new sanctions will take place (though they will be discussing them at
the NATO Summit) but - as we have noted previously - this is yet
another
unintended consequence-driven nail in the coffin of USD hegemony...
The
U.K. will press European Union leaders to consider blocking Russian
access to the SWIFT banking transaction system under an expansion of
sanctions over the conflict in Ukraine, a British government official
said.
The
Society for Worldwide Interbank Financial Telecommunication, known as
SWIFT, is one of Russia's main connections to the international
financial system.
Prime Minister David Cameron's government plans to put the topic on
the agenda for a meeting of EU leaders in Brussels Aug. 30, according
to the official, who asked not to be named because the discussions
are private.
This
has consequences...
“Blocking
Russia from the SWIFT system would be a very
serious escalation
in sanctions against Russia and would
most certainly result in equally tough retaliatory actions by
Russia,”
said Chris Weafer, a senior partner at Moscow-based consulting firm
Macro Advisory. “An exclusion from SWIFT would not block major
trade deals but would
cause problems in cross-border banking and that would disrupt trade
flows.”
But
then we already knew that...
But
while collecting credit card data was to be expected, what is even
worse is that the NSA has also secretly planted itself in the nexus
of the entire global USD-intermediated financial transactions system
courtesy of SWIFT.
The
NSA's Tracfin data bank also contained data from the Brussels-based
Society for Worldwide Interbank Financial Telecommunication (SWIFT),
a network used by thousands of banks to send transaction information
securely. SWIFT was named as a "target," according to the
documents, which also show that the NSA spied on the organization on
several levels, involving, among others, the agency's "tailored
access operations" division. One
of the ways the agency accessed the data included reading "SWIFT
printer traffic from numerous banks," the documents show.
What
is curious is that while the NSA and its henchmen, in this case the
GCHQ, had no qualms about violating personal privacy at every level,
it is only when banks were threatened that someone feel like perhaps
a line was crossed:
But
even intelligence agency employees are somewhat concerned about
spying on the world finance system, according to one document from
the UK's intelligence agency GCHQ concerning the legal perspectives
on "financial data" and the agency's own cooperations with
the NSA in this area.
In
other words, America's unsupervised uber spies, when not
checking in on their former significant others,
spend the bulk of their time tracking who is buying what, where, and
with whose money.
Faced
with the risk of losing access to the network, Russia’s
government has already drafted a bill to create a new Russian system
for domestic bank transfers,
Deputy Finance Minister Alexey Moiseev said on Aug. 27, according to
the Itar-Tass news service.
SWIFT
transmitted more
than 21 million financial messages a day last month,
facilitating payments between more than 10,500 financial institutions
and corporations in 215 countries, the organization said on its
website.
“There’s
no doubt that in the short term restricting Russian usage of SWIFT
would be extremely disruptive to Russian financial and commercial
activities,”
said Richard Reid, a research fellow for finance and regulation at
the University of Dundee in Scotland. “However,
it may carry a longer-term downside, namely the likelihood that large
chunks of Russian international payments flows would move to much
less well monitored and measured financial channels and thus be
beyond sanctions at any future point.”
Several
months ago, when
Russia
announced the
much anticipated "Holy Grail" energy deal with China, some
were disappointed that despite this symbolic agreement meant to break
the petrodollar's stranglehold on the rest of the world, neither
Russia nor China announced payment terms to be in anything but
dollars.
In doing so they admitted that while both nations are eager to move
away from a US Dollar reserve currency, neither is yet able to
provide an alternative.
This
changed
in late June when
first Gazprom's CFO announced the gas giant was ready to settle China
contracts in Yuan or Rubles,
and at the same time the People's Bank of China announced that its
Assistant Governor Jin Qi and Russian central bank Deputy Chairman
Dmitry Skobelkin held a meeting in which they discussed cooperating
on project and trade financing using local currencies. The meeting
discussed cooperation in bank card, insurance and financial
supervision sectors.
And
yet, while both sides declared their operational readiness and
eagerness to bypass the dollar entirely, such plans remained purely
in the arena of monetary foreplay and the long awaited first shot
across the Petrodollar bow was absent.
Until
now.
According
to Russia's RIA
Novosti,
citing business daily Kommersant, Gazprom Neft has agreed to export
80,000 tons of oil from Novoportovskoye field in the Arctic; it
will accept payment in rubles, and will also deliver oil via the
Eastern Siberia-Pacific Ocean pipeline (ESPO), accepting payment in
Chinese yuan for the transfers.
*
* *
As
we concluded previously,
these short-term 'punishments' borne of ego and bluster merely
further 'isolate' the status quo from the inevitable transition...
Still
confused? Then read "90%
Of Gazprom Clients Have "De-Dollarized", Will Transact In
Euro & Renminbi"
for just how Gazprom set the stage for the day it finally would push
the button to skip the dollar entirely. Which
it just did.
In
conclusion we will merely say what we have
said previously,
and it touches on what will be the most remarkable aspect of Obama's
legacy, because while the hypocrite "progressive" president
who even his own people have accused of being a "brown-faced
Clinton"
after selling out to Wall Street and totally wrecking US foreign
policy abroad, is already the worst president in a century of US
history according to public polls, the fitting epitaph will come when
the president's policies put an end to dollar hegemony and end the
reserve currency status of the dollar once and for all, thereby
starting the rapid, and uncontrolled, collapse of the US empire. To
wit:
In
retrospect it will be very fitting that the crowning legacy of
Obama's disastrous reign, both domestically and certainly
internationally, will
be to force the world's key ascendent superpowers (we certainly don't
envision broke, insolvent Europe among them) to drop the Petrodollar
and end the reserve status of the US currency.
And
once
China and Russia show that not only can it be done but thanks to US
prodding it has been done, expect other countries to promptly follow
the anti-SWIFT axis on their own...
* * *
Isolation...
indeed.
The latest fantasies from CNN
But
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