Is The World About To Plunge Into A Financial/Currency War?

FILE PHOTO: U.S. dollar, euro and Swiss franc bank notes are seen in a bank in Budapest August 8, 2011. REUTERS/Bernadett Szabo

James Rickards, Daily Reckoning: Financial Warfare Is Real

In my 2011 book, Currency Wars, I gave a detailed description of the first-ever financial war game sponsored by the Department of Defense. This financial war game took place in 2009 at the top-secret Applied Physics Laboratory located about twenty miles north of Washington, D.C., in the Maryland countryside. 

Unlike typical war games, the “rules of engagement” for this financial exercise did not permit the use of any kinetic weapons such as bombs, missiles or drones. The only weapons allowed were financial instruments including stocks, bonds, currencies, commodities and derivatives. 

The game was played out over two days in the main War Room of the laboratory using six teams divided into the U.S., China, Russia, Europe, East Asia, and Banks & Hedge Funds. The contestants included about 40 players on the six teams and another 60 participants including: uniformed military, civilian defense officials, observers from the Treasury, Federal Reserve, CIA and other government agencies, think tanks, universities, and financial industry professionals. 

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WNU Editor: Financial warfare is happening right now .... Kremlin views sanctions against Nord Stream 2 as elements of hybrid warfare (TASS). 

Update: Here is a good analysis on why concerns that a financial/currency war may soon happen .... Analysis: Is a post-COVID currency war coming? ( Marc Jones, Elizabeth Howcroft, Reuters).

Top Chinese Government Official Warns OF A Financial War Against The U.S.

Reuters

Asia Times: Chinese official raises specter of ‘financial war’ with the United States

Economist Mei Xinyu says the escalating trade dispute between Washington and Beijing could have consequences "beyond our imagination"

As the trade row between the United States and China heats up, a previously dovish senior Chinese government economist has taken the gloves off, quoting Mao Zedong in an interview with SpiegelOnline: “You lead your war, and I lead mine.”

Mei Xinyu, a member of the Ministry of Commerce’s Chinese Academy of World Trade and Economic Cooperation, warned that the two economic giants may be on the brink of a “financial war” with a potential outcome that is “beyond our imagination.”

He told the German website that the dispute over tariffs with the US, which he provocatively dismissed as a country that is going “downhill” and has “lost its fighting spirit,” has undeniably escalated into a full-blown trade war.

“We’ve been in a trade war for about two months. US President Donald Trump has imposed punitive tariffs on Chinese imports worth $ 50 billion and threatens to expand by $ 200 billion. If this is not a trade war, what else?”

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WNU Editor: China has been waging a trade and financial war against the U.S. for a very long time .... not two months as the above Chinese official claims. The difference now is that the U.S. is standing up for itself, and the trade and financial models that countries like China have built their success stories on are now being threatened.

An Analysis On Financial Warfare And Its Growing Importance In Future Conflicts

Former CIA and NSA director Gen. Michael Hayden. Photo: Reuters/Chris Usher/CBS News

James G. Richards, Darien Times: Conversation with a spy

Only one person has ever been director of both the National Security Agency and the Central Intelligence Agency. That person is retired Four-Star General Michael Hayden. Recently I had the chance to talk to Mike Hayden on Capitol Hill. We were both there as part of a conclave to discuss the status of Iran-U.S. negotiations on uranium enrichment. We had a chance to talk one-on-one about my specialty, which is financial warfare, and the potential impact on investors.

General Hayden’s career as a military and intelligence officer spans four decades beginning with his commission as an Air Force officer in 1969. From 1980 to 1982 he was intelligence chief at Osan Air Force Base in Korea. From 1996 to 1997, he commanded the Air Intelligence Agency, today part of the Twenty-Fifth Air Force, which is one of the 17 separate agencies that make up the U.S. Intelligence Community.

WNU Editor: Financial warfare .... and its growing importance in future conflicts .... is one of those stories that needs to be covered more extensively. This post is a good start to better appreciate why this type of warfare is going to be more extensively employed in the years to come.