"China cannot safely own western government debt--Europe or America, They're trying to divest from the west because they know war is coming."

You're going to start seeing a lot more countries starting to draft again because they know what's coming.  --Martin Armstrong

7:35  The sanctions against Russia were basically a warning sign against China.  If China goes into Taiwan, why would you want to hold any U.S. government debt because Biden could freeze it and say, "Oh, we're going to seize it, and use it to pay for preparations for Taiwan.  China has been reducing its holdings of long-term debt especially.  They reduced their holdings, particularly since October 2021, and they've been shifting towards gold.  Why?  It's got nothing to do with money supply, inflation, or anything of that nature.  It's the fact that they cannot safely own western government debt--Europe or America.  Because of what they've done to Russia, they can do to anybody.  All of a sudden, why would you own debt of any western country, Australia, Canada, U.S., or Europe, if suddenly the politicians said "Oh, we don't like what you did" and suddenly freeze it?  So that's a completely different motive for buying gold because of inflation or money supply or something like that that you traditionally hear.  So the motive behind the old iron curtain--China and Russia--is completely different than what we have domestically.  So you have to understand that the motives are very, very critical because it doesn't matter to them what the inflation number is or anything of that nature.  They're trying to divest from the west because they know war is coming.  

You have to have reserves.  Gold is at least recognized as official central bank reserves, but the quantities that they've been buying are not that significant from a global monetary perspective.  I was speaking with one central bank, and they're fed up with the European debt.  They can't buy anymore.  They don't want it.  You had Christine Lagard come out saying, "oh, well, the central bank . . . we should come out and be doing climate change bonds," complete insanity.  And you had the fed come out and say, "Ah, we're independent, and we have nothing to do with climate change."  So you have a real conflict going on here.  Among other nations, they're looking at the ECB and saying, "You people are completely out of your minds."  So it makes no sense to hold any EU debt at this stage in the game.  

The war in Ukraine escalates, and that's a direct line of fire right there.  Sweden just issued an order for drafting its citizens.  Belarus did it.  You're going to start seeing a lot more countries starting to draft again because they know what's coming.

You've written the article, "Stirring the Pot for War," Martin Armstrong, January 9, 2023.