China Moving Into South America?

China Moving Into South America? by Rory – The Daily Coin

While the situation in Venezuela is horrific I would argue, as I have on a number of occasions, the entire Venezuelan situation was created by the Federal Reserve through one of their main banking “generals”, Goldman Sachs. The reason for my speculation is simple – gold. Venezuela asked for, and received, the return of their gold. As soon as it arrived Venezuela began having economic problems. Venezuela, like many nations around the world, is dependent upon Federal Reserve Notes, the world reserve currency, in order to conduct business with other nations. Combine this with economic sanctions from the U.S. and a small nation like Venezuela can get into trouble pretty quickly, and she did. Goldman Sachs offered to loan funds against the gold, Venezuela refused and their situation deteriorated further.

Fast forward to today and we find Venezuelan President Chavez dead, incompetent President Maduro destroying the economy to save it and a whole host of other problems.

Enter China.

China’s Development Bank has loaned Venezuela $5billion equivalent using oil as collateral. For long time readers of The Daily Coin you are well aware we have been covering China’s financial systems development and the integration with the global markets. To this point she has not made any moves in central or South America. China has been in discussions, for many years, with Mexico regarding their participation in the BRICS alliance; to date, there is no real commitment from either side.

This brings us to what is happening right now.

China’s Development Bank has approved a US$5-billion loan for Venezuela’s oil industry, Bloomberg reports, quoting the troubled South American country’s Finance Minister Simon Zerpa.

“We’ve received the authorization for a direct investment of more than $250 million from China Development Bank to increase PDVSA production, and we’re already putting together financing for a special loan that China’s government is granting Venezuela for $5 billion for direct investments in production,” the official said.

The loan is literally a lifeline for PDVSA, which has been unable to stop an accelerating production decline resulting from years of mismanagement and a cash crunch brought about by the tightening grip of U.S. sanctions. Source

As Venezuelan President Maduro continues to destroy the economy of Venezuela and drive people out of the country and suffer through 43,000% inflation it seems like a logical conclusion that China is going to call this loan due and will at that point own the ocean of Venezuelan oil. The oil is far from the best, it actually is some of the worst oil to be found, however, Venezuela is floating on a massive pool.

As a major creditor and ally, China is sure to benefit from some preferential oil export conditions amid rising international prices that would ensure its continued backing of Caracas.

“One of the best things about Venezuelan oil was its stable volumes for all these years and competitive prices,” a senior Chinese oil industry official with direct knowledge of the Venezuelan supply issues told Reuters last month. “But now they seem in very bad shape, not having the money to upgrade port facilities, no money even to remove the high water content in crude oil.” Source

China is the worlds largest user of oil and this would go a long way to creating a long term stable oil supply. China is doing the exact same thing in Africa with purchasing massive tracts of land for farm production. Combining these two strategic elements to long term stability of their nation China is now set up to surpass all of the western “developed” world and never again play second fiddle to the war lords of the west.

What’s happening in Venezuela begs the question regarding President Trump being told it may be a good idea to “invade” Venezuela. Why would the U.S. wish to invade Venezuela, other than to start a proxy war with China or steal the oil she is sitting on?

As far back as August 2017 the Trump administration was discussing “invading” Venezuela.

“I’m not going to rule out a military option,” Trump told reporters at his New Jersey golf club discussing recent events in Venezuela.  “We have many options for Venezuela, including a possible military option, if necessary,” Trump said after a meeting with Secretary of State Rex Tillerson and UN Ambassador Nikki Haley. Source

This sounds more like “locker room talk” than serious pursuit. Was this a warning to Venezuela, Russia and China the U.S. is paying close attention and will be happy to drop love bombs at a moments notice? The reason we ask is simple. July 4, 2018 President Trump was discussing the real possibility of “sending tanks” to Venezuela.

Apparently, President Trump’s offhanded remarks about sending tanks to Venezuela were more than just a scare tactic. Trump reportedly asked a group of senior administration officials why the US couldn’t simply invade Venezuela during a meeting in the Oval Office, according to the New York Post. The meeting was called to discuss sanctions against members of the Venezuelan regime.

We can only look at what is presented and attempt to see through the fog. It doesn’t make sense, at least not to me, to even be discussing military action against Venezuela. Why would this be a topic of discussion? China being in the backyard, Federal Reserve Notes and gold, that’s why.

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The Daily Coin

Rory Hall, The Daily Coin. Beginning in 1987 Rory has written over 1,000 articles and produced more than 300 videos on topics ranging from the precious metals market, economic and monetary policies, preparedness as well as geopolitical events. His articles have been published by Zerohedge, SHTFPlan, Sprott Money, GoldSilver, Silver Doctors, SGTReport, and a great many more. Rory was a producer and daily contributor at SGTReport between 2012 and 2014. He has interviewed experts such as Dr. Paul Craig Roberts, Dr. Marc Faber, Eric Sprott, Gerald Celente and Peter Schiff, to name but a few. Don't forget to visit The Daily Coin and Shadow of Truth YouTube channels to enjoy original videos and some of the best economic, precious metals, geopolitical and preparedness news from around the world.