China Moves To Unilaterally Cancel OTC Derivative Loss Debts Held By State
Posted: Sep 02 2009 By: Jim Sinclair Post Edited: September 2, 2009 at 11:03 am
All men can see these tactics whereby I conquer, but what none can see is the strategy out of which victory is evolved.
Reported Chinese actions to unilaterally cancel OTC derivative loss debts held by state corporations whereby they purchased hedge contracts written by major American OTC derivative manufacturers and distributors is legally a unilateral novation. A novation declares an item to be invalid. Invalid means not valid. A contract which is not valid infers a form of a fraudulent contract.
Actions by the Chinese tend to follow and can be understood by learning the tenets of the teachings of Sun Tzu.
Had the West acted exactly this way rather than financing them to pay the winners when the hedge fund, Long-Term Capital, failed on OTC derivatives, there would have been financial problems but this event today would only be a modest recession and not a catastrophic depression.
MOPE has blacked this event out while titanic pressure is being brought on the US to fall into line and pay off the winners in New York.
What happened here will pave the road of the future.
This is the most important economic event since the fall or shove into bankruptcy of Lehman.