Why is America number one in the world? Why is the dollar the world currency? Why does the US Federal Reserve sneeze and the whole world tremble?
Today, let's take a look at how the United States controls the world and harvests global assets through financial means.
Finance was originally invented by the Dutch, then Britain perfected the mechanism, and finally the United States took the baton of developing finance in its own hands. It can be said that Wall Street played a vital role in the rise of the United States.
In 1970s, with the collapse of the Bretton Woods monetary system and the impact of global financial liberalization and global financial innovation, the financial derivatives market developed rapidly.
1972, Chicago Mercantile Exchange took the lead in launching six foreign exchange futures contracts, including the pound. At this point, financial derivatives were born.
Financial derivatives!
It is a kind of contract, and its purpose is simple, that is, to help traders transfer risks. Its characteristic is margin financing and securities lending, which has leverage effect.
At the beginning of its birth, the transaction volume was not large, but when people realized the huge profits, they were not calm.
Don't underestimate people's wisdom, let alone their greed.
Marx has such a passage in the annotation of "so-called primitive accumulation" in section 7 of chapter 24 of Das Kapital.
The original text is as follows: "As long as there is a proper profit, capital will be very courageous."
"As long as there is a profit of 10%, it will be used everywhere."
"With 20%, it will be lively."
"50% will cause positive risks."
"Having 100% will make people disregard all laws."
"There are 300%, can let a person not afraid of crime, even afraid of the danger of strangulation. If unrest and disputes will bring profits, they will be encouraged. Smuggling and slave trade are evidence. "
The above arguments are very objective, fair, scientific and wonderful, both at home and abroad.
After that, financial derivatives such as financial futures, options, swaps and derivative securities rose in the international market.
Of course, although financial derivatives have arbitrage space, their advantages are indelible.
It has the functions of risk management and leverage effect, effectively makes up for the shortcomings in the traditional financial market and greatly promotes the development of the international financial market.
But with the help of financial capital, there are opportunities and risks.
During these years' development, people all over the world, while enjoying the economic growth brought by Wall Street, are also cursing the crisis brought by financial development. Many enterprises are afraid of the risks brought by the financial crisis while relying on the rapid expansion of capital.
After the financial crisis in 2008, a survey showed that 94.2% enterprises used derivatives to manage or avoid the commercial and financial risks they faced, and only 5.8% enterprises did not use derivatives.
Almost all the Fortune 500 companies use derivatives.
Although during the financial crisis, financial derivatives were resisted by the public, and their usage was greatly reduced, but after only one year, the trading volume rebounded rapidly, and after a few months, it basically recovered to the pre-crisis level.
Even in the whole year of 2009, the turnover reached a record1123.28 billion dollars.
It is no wonder that after nearly 40 years of development, financial derivatives have become very diverse and complex, and have become weapons of mass destruction equivalent to nuclear weapons.
Once it is not used, it will be a direct nuclear explosion, the world will be destroyed, the economy will collapse, and people's hearts will change. As long as they are interested, they will not give up.
Credit Default Swaps (CDS)!
Credit default swaps, also known as credit default swaps and loan default insurance, are the most widely traded OTC credit derivatives in the world.
The International Swaps and Derivatives Association (lSDA) established a standardized credit default swap contract in 1998.
CDS has developed rapidly because it solves the liquidity problem of credit risk and enables credit risk to be traded like market risk, thus shifting the risk of guarantor and reducing the difficulty and cost of issuing bonds.
This may sound a little complicated. Let me translate it for you.
"I, Li Changhe, lent my friend Wang Erdan 100 yuan, and I will return it to him 150 yuan after the loan expires. I didn't ask for collateral, but I was afraid that Wang Erdan would not return it to me when he ran away, so I bought him insurance. If he doesn't pay back the money after the loan expires, the insurance company will compensate me, and I can transfer the risk to the insurance company by paying the premium. This is called credit default swap (CDS). I used to lend money to Wang Erdan without mortgage. This is called credit! "
In 2000, the CDS market was $630 billion, and the development speed was unimaginable. Seven years, just seven years, in 2007, it reached 62 trillion, yes, it was 62 trillion.
7 years 100 times growth!
It is no exaggeration to say that once the global credit default rating collapses, the world economic order will collapse, and no one knows what will happen then. Fortunately, after the financial crisis, CDS is decreasing, and now it is only about 10 trillion, which is within a reasonable range.
Back to the topic, why can the United States dominate the world? Bullying people around you and making trouble?
That's because they kidnapped the world economy, because it can create huge market demand and make the world feel profitable for the United States, a major trading country.
Driven by the interests, these trading countries have become wage earners of dollars, suffering from exploitation and fraud, but they are helpless.
However, human greed is fascinating. After the economic crisis, the strength of the United States declined relatively, and the loss of wealth and the destruction of the financial system seriously shook the foundation of American hegemony.
Especially the astronomical American debt, in fact, if you look at the money owed by the United States, if it was a company, it would have gone bankrupt.
However, because the dollar is the currency of the world, even though the financial crisis in 2008 weakened the United States, it is the same as the United States.
China starts the printing press, and money is inexhaustible.
Using the global currency status of the US dollar to transfer the crisis to the whole world.
Other countries don't want to, but there is no way. Before the establishment of the new order, they can only tolerate the exploitation of the United States.
The United States has thoroughly understood the psychology of these countries and grasped the pulse of these countries, so it is fearless and does whatever it wants.
Therefore, the cornerstone of American hegemony is the financial capital of Wall Street and the financial capital empire manipulated by military industry.
Of course, America owes so much money. What do you think will happen if one day it doesn't?
But I bet that smart America won't do anything to dig its own grave.
There is only one way to end American hegemony, and that is to stifle the dollar's status as a world currency. By that time, it can be expected that American hegemony will fall apart!