Transcript of the above video:

Now for those who watch this channel, and you sort of watch some of my personal stuff that I have kind of reincorporated into this channel because especially with this BRICS stuff and everything, it's starting to have real pertinent impact on the day-to-day here in Thailand and how everything is going to work. I expect it will have a major impact on international trade and international trade regulation. These videos I do understand, they're kind of dry, they're not exactly the subject matter that most people really like to dive into but this is important stuff. This is actually a pretty big deal what's going on here and I have noticed that the punditry caste or class if you will mostly on FinTwit, sort of the financial Twitter media if you will, they have been talking about this but I don't think they're really seeing what's going on here, mostly because they are Westerners quite honestly and they are living and operating in the West and quite frankly it's clouding, in my opinion, their perspective. That said, let me dig into this and then we will get into what I'm talking about here.

I thought of making this video after reading a recent article from Reuters, that is reuters.com, the article is titled: BIS to leave China-backed Central Bank Digital Currency Project. BIS is Bank for International Settlements. Now we have talked about this a little bit on this channel; I have talked about it a lot and at length on my personal channel some time ago, long story short, Bank for International Settlements have been working on this platform - sometimes it's called a protocol - protocol is probably the better way to look at it - it's not like a physical platform. But this protocol is called mBridge, it's a protocol that is being created in cooperation between Chinese Authorities, Hong Kong Monetary Authority, Bank of Thailand, and the Central Bank and the United Arab Emirates, and basically and there's a joke - I'm going to put a link in the description below to a Twitter, it's a Twitter link, an X Link, whatever and it's a podcast between a guy named Tom Longo and a guy named Vince Lanci, - I can never quite know how to pronounce his surname. I've had some interaction with both of these guys on the internet and I think that they are very smart when it comes to their analysis, especially of more day-to-day levels of what's going on in terms of geo-politics but they were talking about this recent development, that DIS is backing out if you will of mBridge, I talked about it in a prior video as well, I don't think this is exactly even what they think it is although they have a lot of really insightful stuff in that podcast, most notably the “re-regionalization” of certain types of currencies including the dollar; getting into like the different if you will motivations of all the different actors geo-politically with regard to what's going on with the creation of this mBridge protocol, and how these interactions are sort of causing this thing to evolve. But what they're not seeing in my opinion is first off, I'm coming increasingly to the conclusion that the discussion of gold in the context of mBridge or any type of BRICS, intra or inter, sort of capital transfer sort of system involves gold.

They have talked a lot about gold but I'm coming increasingly to the position that Asia just deals with gold differently than the West and the West really doesn't get it. It's like here in Thailand, the Thai Gold shops, they operate like inverted banks basically. Thais buy gold to save money and they keep the gold on them or in their house or whatever and then when they need Fiat they go to gold shop and they get Fiat, they get cash, currency if you will. This is different than the way the West does anything and I saw this phenomenon most acutely when COVID first hit and the lockdowns all started, people needed money, they needed liquidity. Well what did they do? We didn't need the government to go, specifically the Central Bank to just print money money and create it, shoot it out into the system, no, Thais went to the Gold shop and there were lines around the block in certain gold shops where they were going to change their gold back to cash; that was what they were doing. This is a very different dynamic than operates in the West. This is just a fact okay, and I think it's the missing piece and if Mr Longo or Mr Lanci sees this video, I hope you understand I was trying to make a point of this with one of them on Twitter and I don't think I really articulated my point very clearly. I want to be clear, I'm not articulating clearly because even I don't fully understand the ramifications of all this. I'm trying to keep track of it as best I can. But one component that Westerners seem to be missing in their analysis is how the East deals with gold. It's very different than how the West deals with gold. So again, more and more, let me read the article and I'll do some further analysis. Quoting directly, again, BIS to leave China-backed Central Bank Digital Project. Reuters.com. "The Bank for International Settlements said on Thursday it would quit the cross-border payments platform Project mBridge, raising questions about how the scheme backed by China will evolve at a time of growing geopolitical scrutiny of global transfers." So what's going on here? Well look, good, bad or different, In 2022, effectively the US weaponized the Dollar when the whole Ukraine thing started; they seized Russian assets in the form of sovereign debts, sovereign currency holdings and they just seized them, and they denied access to the Swift system. This caused obviously a great deal of consternation in Russia, but it caused the rest of the world to say "hey, if they can do that in Russia, could they do that to us?" So that's causing sovereign nations, sovereign entities, around the world to start looking for alternatives.

The analysis here is not about sovereign reserves; I'm not getting into treasuries and sovereign debt. What we are talking about here more than anything and a more pertinent point, is a means of transferring capital okay? Not store of value, medium of exchange. Forget store of value for the moment. In my opinion, mBridge is purely about creating a medium of exchange, a platform or protocol whereby folks that aren't the United States can interact with one another, transact with one another without either using the Dollar or the platforms associated with Dollar transfers - things like Swift for example which to this point has been the unilateral method of moving large amounts of capital around the world. This is changing. Whether Americans like it or not, let me clear and let me point out one of my personal biases. I don't like this. I don't think this is particularly good for America. It's not particularly good for, what do you want to call it, the pax-Americana, the World Order, the rules-based International Order sometimes referred to. Again this isn't a particularly great thing for any of that. Quite honestly, I am an American; I was born there and I am not averse to any of that per se. Could it be improved? Sure. But do I want to see the wholesale end of it overnight? Not particularly. Could this end it overnight? I don't think so. And again I have discussed this in other videos, it's not a zero-sum game but at the end of the day this is important and it will change things but I don't think folks are understanding what this is. This mBridge thing more and more is looking to me less like "hey we are creating a currency". That's been to my mind maybe the red herring. These nation states don't really care about an idea or the idea of a notion of a new currency. I don't know why the West is obsessed with it, other than it just fits in their paradigm. They can't thank beyond their own paradigm and the last major move we saw in terms of geopolitical finance was the creation of the Euro. The last big major move was the creation of Euro. So now I think in the Western mind, everything revolves around creating a new regional currency. I don't think that's what's going on here with mBridge. I think what all of these nations states over here in Asia want is they just want a medium of fair exchange and they will just go ahead and use their national currencies. One way to look at this in my opinion is to look at it as if these countries, most notably China, Hong Kong Monetary Authority, Bank of Thailand and Central Bank for UAE, they are basically trying to create what I would argue is something akin to the transfer wide system as it exists now except instead of it being basically a way of acting as a capital movement sort of coordinator within a Commercial Banking system, they're looking at it as the same sort of coordination platform but between both Central Banks and Commercial Banks. That's the big difference here. And they're looking to do it in such a way that it has nothing to do with the Dollar and nothing to do with the Swift system. So again in a way it looks to me like they're trying to create an alternative to Swift and if you want to drill down even further, I think an even better analogy or at least an easier analogy for most lay people, including myself, to understand is the notion that this is going to look a lot like transfer wise, again the difference being transfer wise right now mostly deals with Commercial Banks to Commercial Banks and sort of creates more efficient ways of moving Capital between them. This system will operate between Central Banks and Commercial Banks; it will be a protocol that sort of weaves in and out in such a way that it avoids again the Dollar and the Swift system.

That said, quoting further: "Project mBridge, a collaboration launched in 2021 between the BIS and the Central Banks of China, Hong Kong, Thailand and the United Arab Emirates, was joined by the Saudi Arabian Central Bank in June." I can't stress that enough. That is a huge development, the fact that the Saudis are involved with the mBridge protocol. Meanwhile, again stop thinking about this as creation of a new currency, think of it as creation of a new protocol system. Again, I think transfer wise is a good analogy at least for sort of working within my own mental framework. That said, quoting further: "It also has many more observing members." Quoting further: "BIS General Manager, Agustin Carstens announced the step after being asked whether mBridge could provide a basis for BRICS countries, which include Russia, to get around International sanctions, a notion he rejected." Now this is a direct quote from the Head of the Bank of International Settlements, quote: "The BIS is leaving that project.." - so we noted that in another video, BIS is pulling out of the mBridge project. As I noted I think that timing may be of an issue here too. If you go back under Obama, they put pressure on the guy that headed up Swift and Swift is kind of similar to BIS, it's this sort of international supranational, extraterritorial body, the Head of the Swift at the time when Obama put some pressure on him wouldn't go along with weaponizing Swift. Years later, later we get to Ukraine, Russia and they went ahead and did it. Carstens is now saying okay BIS is going to pull out of dealing with this mBridge because of the sanctions and the whole Russia issue, but as I noted in a prior video, his term ends I believe this coming June or July and we could see a similar scenario play out that we saw with the changeover in Swift, where policies change when the head changed. Let's set that aside for a moment, because I think there's something even of more deeper significant and importance here, again quoting directly, and we're quoting directly from BIS General Manager Carstens: "The BIS is leaving that project not because it was a failure or not because of political considerations but mostly because we have been involved for four years.." - and this is key - ".. and it is at a level where the partners can carry it on by themselves." Again, BIS may not be involved. They may just say "look, okay we get it; there are sanction problems, we just wash our hands of it, we don't even want to deal with it” but these other countries, they're looking for an alternative and it looks to me like they found one because it's working now, and BIS has said "we don't need to be involved with it anymore, it's working on its own, those partners can carry it on, on their own". That's a pretty big deal and again, I think this will have tremendous implications for international trade both here in Southeast Asia and greater Asia as a whole.