With its dominant influence over the I.M.F., where its voting power of over 16% placed it in complete control of any vote [because a basic requirement of the I.M.F. is that for any issue to be passed, it must have the support of 85% or more of its members votes. This left the U.S.A. in control of not just of the most important of the globe's financial institutions but of the global monetary system. Through the $ being the currency in which oil was priced, it reinforced this strength and dominated global trade through oil. The tribute [tax] it then drew from the world through the printing of the $ for international trade, was the equivalent of the tribute Britain drew in the days of its global empire. The expansion of the Trade deficit is serving the same function, which explains why little is being done to correct that imbalance. With recipients of the $ content to reinvest their surplus $' back into U.S. Treasuries and bonds, the States is receiving cheap financing of its economy. So all looks fine as the U.S.A. draws off the benefits of its pivotal position.

The only action being taken to adjust this at present is a trip [which we believe will be a failure before it begins] by the Chairman of the Federal Reserve Ben Benanke and the Treasury Secretary Paulson to China. Ostensibly this is to persuade the Chinese to revalue their currency. The Chinese authorities have responded to this request many times already and forcefully, so why the trip? Is it a posturing that it is the Chinese that is at fault or what? Needless to say any responses from the trip will do little to strengthen the $. This trip does little to address the growing problem of the falling $ in the foreign exchanges, the ultimate measure of the true value of the $.

But the process of Asia's enormous growth is that it is moving toward being the most important economy in the world alongside India and other emerging economies. As such it will move to take the reins of global financial power.

The tipping of that power towards the East has to precipitate the end of the reign of the U.S.$ as the key global currency. The Chinese Yuan is by no means ready to take those reins, nor we suspect, is the €. Nevertheless, the $ is on the decline long-term due to this shift in power. Even if this concentrated power is re-distributed to several other currencies, the decline of the $ will continue and with a growing ace.

As we have often said in these columns, we do not expect the $ to decline down a gentle slope, but to move along a plateau, before dropping down a cliff to the next level at which it will plateau before the next fall. Steadily we will see the pressures from excess U.S. $' bring not only a value decline but also a heavy loss of confidence in the $ from outside the U.S. of A.

It appears that we are very close and have possibly begun the first cliff edge fall to the next low. The fall may be steeper and greater than most have imagined.

Many monetary officials in the U.S.A. have expressed their lack of knowledge of what lies ahead in this type of situation. But the very structure of nations self-interest will cause a weakening $ to fall further once the falls really begin. We have to say that such $ crises in the global foreign exchanges have the potential to structurally damage the globe's monetary system in ways never seen before. What we take for granted as being an exchange rate crisis will pale against the breadth of this impending drama as it encompasses several currencies in its wake.

As we wait on the brink of these changes, we can be certain that both gold and silver will rise further to take on the mantle of safe currencies beyond the reach of Central Bankers, who may likely support their role as an alternative currency. What is certain is that once confidence in the $ starts to become visible in the markets the gold price will rise in a manner completely inconsistent with its role as simply a metal, a commodity.

Hence we ask our readers to be prepared for more than seems 'normal' in the days to come.

Because its brackets are not automatically indexed for inflation (unlike the regular income structure, which is), it catches more taxpayers every year as their incomes rise to AMT levels.

"This year it will affect 3.6 million taxpayers, at an average of about $6,000 per return," says Lonnie Davis, director of tax services for CBIZ Accounting, Tax & Advisory Services in Plymouth Meeting, Pennsylvania.

It's tough to understand, but ignore it at your own peril. Every year the AMT snags more taxpayers, and if it snags you, the very actions you take to cut your taxes (such as making extra mortgage payments in mid-December) could come back to bite you.

Here's what you need to know -- and do -- right now:

-- Get a basic idea of how the AMT works.

In most simple terms, it applies a lower tax rate to a broader definition of income. It defines income more broadly by disallowing some write-offs, such as state and local taxes deducted, some home equity interest, some medical expenses and some profits on employee stock options.

It also disallows personal exemptions, hitting big families hard. (For a complete list of the so-called "preference" items disallowed by the AMT, go to the IRS Web site and download Form 6251 and its instructions.) Then it subtracts a special AMT exemption amount, and then it subjects the income left to tax rates of 26% on the first $175,000 ($87,500 for married couples filing separately) and 28% on the excess.

-- Drill down and guesstimate whether you're going to be subject to the AMT.

Look at last year's return and see if you paid any AMT. Even if your situation is pretty similar this year, you may not be subject to it because of two changes made in the tax bill passed earlier this year.

That bill slightly increased the AMT exemption that gets subtracted from your income. The same law eased up on AMT treatment of a variety of credits including the child and dependent care credit and Hope scholarship and lifetime learning credits.

A quick and dirty way to see if you'll be hit by the AMT is this: Find out what your marginal tax rate is, and subtract the AMT rate. If, for example, you're married filing jointly with an income of $150,000, your regular marginal tax rate is 28 percent and your AMT rate is 26 percent, making the spread between the two taxes only 2 percent of your income. If your list of preference items, personal exemptions and the like exceed 2 percent of your income, there's a good chance you'll be AMT bait.

If you use tax-preparation software, you can open last year's forms, guesstimate your income and deductions, raise the AMT exemption amount on form 6251 to 2006 levels of $62,550 (married joint), $42,500 (single) or $31,275 (married filing separately.) See if it calculates an AMT payment for you.

-- Then what?

If you expect to be AMT'd, think backward, says Davis. Put off that year-end home equity or tax payment until January. Defer your miscellaneous expenses, like investment interest or job-hunting expenses. Bring extra income, such as bonuses, into this year. Your mission is to keep preference items a low-enough proportion of your taxes to kick you out of AMT contention, at least for one more year.

-- Watch Washington.

Both Democrats and Republicans say they want to "fix" the AMT problem, but they'll have their own problems doing that. They're not supposed to cut taxes in the future (as any AMT fix would do) without finding like income elsewhere, and there's not many other places for legislators to go to fund that.

It's more likely that the best they will do is continue to adjust it annually. That buys them continued attention from tax-focused lobbyists, and it buys them higher revenues that they can count in the out-years, even if they're just going to adjust them away too.

That means if you're just falling under AMT radar, you might continue to escape it, one year at a time.

"There is a degree of acceptance in Asia about the downward drift of the dollar as long as other currencies outside the region rise in value against it as well," said Adrian Foster, foreign exchange strategist at Dresdner Kleinwort in Singapore.

Some countries are more worried than others. South Korean financial officials are concerned about the rapid rise of the won, which on Monday hit a nine-year high against the dollar.

The Korean currency has been among the fastest rising in the world, appreciating by nearly 10 per cent against the greenback this year, which has affected profits at South Korean exporters such as Samsung Electronics and Hyundai Motor.

Traders say the Bank of Korea appeared to have intervened heavily last month to try to stem its ascent.

Thailand fears that its export competitiveness will be harmed by a rise of the baht, which has appreciated by 15 per cent against the dollar this year.

The central bank has turned to administrative measures to ease upward pressure on the baht. In an attempt to deter short-term speculation on the currency, the Bank of Thailand on Monday announced that non-residents holding Thai treasury bills, government or central bank bonds without underlying businesses in the country must retain them for at least three months before selling them on.

Bigger economies appear better able to withstand the effects of a falling dollar. Japan, whose currency is considered undervalued against the dollar and euro, has not shown undue alarm at the strengthening of the yen against the dollar in the past few weeks.

Officials have suggested that they see no reason for the yen to weaken further given the health of the economy. Yen weakness has been blamed partly on the carry trade, in which investors borrow cheaply in yen to invest in higher-yielding assets, including US-denominated ones, abroad.

China has been in effect supporting the dollar for a number of years due to its purchases of US Treasuries and other financial instruments, which make up an estimated 70 per cent of its $1,000bn foreign exchange reserves.

There has been no hint that the State Administration of Foreign Exchange (SAFE), which manages the money, has been buying dollars to support it or ease its decline.

But China's reserve holdings do give it an incentive to support a strong dollar. SAFE has became concerned about the negative impact on the dollar of suggestions that Beijing had been diversifying into other currencies.

One challenge facing Asian central bankers, however, are signs of inflation that could force them to raise interest rates and the value of their currencies as a result.

Mr Foster said: "The central banks must balance the need to keep inflation under control without causing their currencies to appreciate sharply."

Reporting by John Burton in Singapore, Anna Fifield in Seoul, Amy Kazmin in Bangkok, Richard McGregor in Beijing and David Pilling in Tokyo

So what then? Among the wide range of views on this subject, two are particularly popular, one pessimistic, one optimistic - and both wrong. The pessimistic view is that a sharp and sudden adjustment in the US current deficit would hit the eurozone harder than other regions. Since many Asian and Latin American currencies are pegged to the dollar, the brunt of adjustment would fall on the euro, leading to a sudden collapse of European exports to the US. The optimistic view, often heard inside the eurozone itself, is that the trade exposure to the US is relatively small - eurozone exports to the US make up only about 4 per cent of gross domestic product. This suggests the eurozone would get off lightly.

Both views are wrong. The first misjudges the adjustment dynamics, and the second focuses too much on trade as a transmission channel for a global adjustment shock. Trade is still an important channel for Asia, but much less so for Europe, where financial transmission channels play a more important role. A big effort to disentangle these channels was recently undertaken by two academics, Philip Lane from Trinity College in Dublin and Gian Maria Milesi-Ferretti from the International Monetary Fund*. They looked at three scenarios: a soft landing scenario, a disruptive scenario and one in which the world's policymakers would do all the right things at the right time - the triumph-of-hope-over-experience scenario. Scenarios one and three are both benign and improbable. It is scenario two we should worry about.

On their calculations, a sudden adjustment in the US current account, accompanied by an unexpected 20 per cent dollar depreciation, would lead to a deterioration in the net asset position of European countries by 1.5-3 per cent of GDP, partially offset by gains by banks with short dollar positions. The countries worst affected would be the Netherlands, Denmark, Sweden, Norway, the UK and Switzerland. Interestingly none of these countries, save for the Netherlands, is a eurozone member.

The effects of a sudden adjustment shock are not only significant, but also extremely uneven. A sharp fall in the dollar would probably end the eurozone's current mini-boom. It would most certainly hit Asia. The idea that the Asian consumer would miraculously come to the rescue of the world economy is wishful thinking. A sudden adjustment of global imbalances is a serious asymmetric shock for the world economy. But it is far from clear that the eurozone is more exposed than others.

On the contrary, it appears that eurozone membership may protect some countries from the worst. It is conceivable that global investors may pull out of non-eurozone countries with high current account deficits. We witnessed a taste of sudden risk-aversion in Turkey and Hungary earlier this year.

So what should policymakers do? Two years ago in the last period of dollar weakness, central bank intervention put a floor under the dollar. But the US economy was strong and interest rates were rising. Now the economy is weakening, along with the interest rate outlook.

What about structural reforms? Even if well implemented, they take time to work through. The best policy response to a global adjustment shock has to be a relaxation in monetary policy and a co-ordinated fiscal stimulus. I am not at all sure this will happen, given the past record. If I am concerned about the eurozone, it is not so much about the event itself but how we react to it.

*Europe and Global Imbalances, draft paper, September 2006

Beijing just unleashed a deadly three-prong attack that will levy a FINANCIAL FIRESTORM on the American economy. Before it's over, many billions of dollars will vanish into thin air! But these two simple investments can protect you. In fact, not only will they "China-proof" your portfolio... they can give you super- safe-haven profits as high as 794%..

WATCH OUT! China's "UNRESTRICTED" ATTACK on the American Economy Has Already Begun...

Find out about these two simple investments to completely "China-Proof" your wealth AND to rake in safe-haven profits that could go as high as 794%...

Dear Friend,

I hope you're ready. Because whether you realize it or not, Beijing's military government has just declared a hidden WAR on the American way of life!

Yep, that's right. Over the next five minutes, you'll read about something so shocking, The Vancouver Sun calls it, "The big sword overhanging the U.S. economy." The Irish Independent says it could "rip the heart out of manufacturing growth in Europe and America." And the New York Times says this savage cycle of financial malice could actually destroy "the very stability of the global economy."

"The Chinese make the televisions. The Americans watch them."
Popular Chinese saying

I'm talking, of course, about China's jaw-dropping economic growth over the last several years running. History has never seen a country grow this fast. I'm sure you already know there will be consequences.

Big ones.

Even the Asia Times is predicting a crisis "more devastating to the U.S. economy than any nuclear strike." But what I doubt you know -- yet -- is just how deep and deliberate this financial havoc will be.

Over the next five minutes, you'll see how this threat from the East was actually designed to DESTROY the U.S. economic advantage. Intentionally. What follows is an imminent DISASTER for the bond market... DEVASTATION for the already-weak U.S. dollar... and absolute ANNIHLATION of most of the popular stocks on Wall Street! If you're not careful, you stand to lose everything. Watch as it happens. Interest rates are virtually guaranteed to skyrocket... America's real estate bubble will POP like a balloon at a porcupine party... and the voracious financial backdraft that follows will literally suck the life out of America's so-called "recovery"...

I don't paint a pretty picture. But that's only the bad news. The good news is you can protect yourself! Two Powerful Moves That Can Protect Your Money

I'm about to show you a powerful strategy that cannot only protect you... but it can make you an incredible 794% profit. It's easy to do.

Of course nothing is a sure thing but this is pretty close. Just talk to any broker. Or log onto your favorite trading website on the Internet. This strategy I'll reveal only takes about five minutes to execute. And you can get started with very little capital.

Because part of the strategy is a leveraged investment, you only risk what you put in. But you stand to make many, many times that in financial "safe-haven" profits. This strategy I'll reveal starts with two simple investment opportunities. Do just one, and I predict you'll make as much as 350% to 400% Do the other, and you stand to make up to an additional eight times your money. And combined, the whole package gives you a fortress in which you can safely park some of your wealth.

Because I know already what this strategy is, I also know it's something you won't find anywhere else on the market today. And I'll reveal it to you in just a second. But first... How to Survive the Most Serious Financial Threat Since 1929 What follows is not a trend you can shrug off. It's not a "recoverable blip" in the market. Washington has no control over this. New York and Chicago brokers have no control over this. And Europe has no control over this either.

"Many economists believe that the Chinese currency is undervalued by as much as 40%, giving the country an unfair advantage in being able to underprice competitors in international markets."
The Washington Times ,Dec. 10, 2003

Which is why what I'm about to describe will turn out to be the most dramatic and serious financial threat America has faced since 1929! I'm so worried about it, I've put together a FREE resource for investors.

I will e-mail it to you, no charge. It's called " Total Profit Protection From the Coming China Crisis!" And again, it's FREE. You'll find out exactly how - step by step - you can pile up as much as 794% gains while you fortify your wealth against the winds of crisis ahead. I've promised you that much already. But then I'll also e-mail you three more FREE reports that show you...

° How to make up to 455% on a buy-and-hold mutual fund!

° A dozen ways to make Asia gains without buying Chinese stocks!

° How to lock in up to 953% profits on the next leg of the gold-market boom!

° And how to sock away as much as 10 times your money on what I firmly predict will be a breathtaking 20-year boom in commodities!

It's all FREE, as part of the STRATEGIC PROFITS PROTECTION LIBRARY I've put together just for you. But I'm getting ahead of myself. First, let's dig into the sordid details of the crisis ahead...

"Beijing's Secret War on America" How China Expects To Win "The first rule of unrestricted warfare is that there are no rules, with nothing forbidden."
- Col. Qiao Liang & Col. Wang Xiangsui China's People's Liberation Army, and co-authors of Unrestricted Warfare

Has there ever been a rising power, in the pages of history, that has picked up economic momentum... packed on military might... and then decided not to flex it's muscles?

The answer, as you well know, is that there hasn't. Power is power. The nations that have it chomp at the bit to use it. Which is exactly what China is doing now. But you don't have to take my word for it. Roger W. Robinson Jr -- head of the U.S.-China Economic and Security Review Commission -- gave this testimony to the U.S. House of Representatives back in October 2003. He laid out the Chinese blueprint for undermining the U.S. economy:

° First, they devalue their currency by as much as 40%

° Then they issue tariffs on foreign goods

° They cut foreign firms off from local marketing channels

° They chaperone and handpick partners for international joint ventures

° They give preferential loans to their own factories from state banks

° Chinese companies get privileged listing on the Chinese stock market

° Chinese companies get special tax breaks not available to foreigners

This assault on the American economy is already well under way. Whether they'll succeed or not we don't yet know. But for a long time to come, you'll need to protect yourself and your money. But you can also profit -- by as much as 794% or more. Click the "Subscribe Now" button below to send for your FREE set of the STRATEGIC PROFITS PROTECTION LIBRARY.

Look, by now you might be wondering if I've got some sort of personal vendetta against China. No! That's not the case at all. I've got nothing against China or the Chinese. In fact, I'm making plans right now to go there and all around the rest of Asia do research on the massive investment opportunities already under way. China has an unbelievable history. They have lots of culture. Three thousand years ago, they were building palaces... while my ancestors were making mud patties on the English moors. So no, I'm under no delusions about the greatness China is capable of. But that doesn't change the rest of the facts I'm about to show you. When I show them to you, I'm confident you'll come to the same conclusions I have. You'll see instantly that what's quietly unraveling the fabric of the American economy... the exploding deficits, the massive trade gap, the joblessness, and even some secret aspects of the war on terrorism... is not only no accident, but it can all be traced back to, shockingly enough, Beijing. Here's the "real" truth: Without a doubt, China's military government has actually masterminded adeliberate assault on the American way of life.

I'm going to show you how they've done it. It's a war. Not with tanks or missiles. Not with jets, bullets, or guns. Or hand grenades. The "combatants" in this battle wear business suits. They hit you with handshakes, contracts, and smiles. But don't be fooled. This is war without rules. In the words of one of their own military officers, "nothing is forbidden."

Without drawing a drop of blood, Beijing fully expects to win... and here's how they plan to do it: Guerilla Economics! Step back for a second. And remember... When we talk about modern China, we're not talking about a democracy. We're talking about a military dictatorship.

Even now, in 2004. This is the way they do business. I'm calling it "guerilla economics." The goal is to destroy the competition. And at the same time... create a guaranteed money-making environment for China's own entrepreneurs.

Is it working.

For China, absolutely... Ding Lei is 32 years old. He's also the richest man in China. His NetEase.com outfit didn't crank out a nickel of profit until 2003. But his stock is up 50-fold thanks to ecstatic American investors, and Ding is now personally worth $900 million! Chen Tianqiao is just 30. In 1999, he ran a cartoon Web site. Now he runs Shanda Networking, an online gaming business out of Shanghai. New York venture capitalists helped him get started. Now he's personally worth $480 million. Larry Rong's dad is Rong Yiren, founder of CITIC. CITIC is the biggest company in China and a magnet for U.S. investment dollars. Larry is personally worth $850 million. His family is worth closer to $2 billion.

The military government of China has their hands deep in the pie too.

Take China's biggest TV and cell phone maker, TCL Corp. It's state owned. Last year they exported 3.83 million TVs. They expect to ship 5 million more!

"All Beijing has to do is to mention the possibility of a sell order going down the wires. It would devastate the U.S. economy more than any nuclear strike."
Asia Times, Jan. 23, 2004

The top 100 richest people in China now have an average wealth of $230 million. Another 10,000 or so more Chinese are worth at least $10 million so far. And that's up from zero millionaires in China as recently as 1979.

Of course, most of the companies listed on the Shanghai exchange are still state-owned. The top 14 Chinese car-makers are state owned -- with bloated bureaucratic budgets. But that doesn't matter -- in 2003, U.S. investors poured millions and millions of dollars into China Brilliance Automotive shares -- and it's stock shot up 232%!

For all appearances, it looks like China has cracked the code of Western capitalism. Three years ago, for instance, China didn't manufacture a single laptop. NOW they make 40% of all laptops sold worldwide! They're also ranked as the world's biggest maker of computer hardware... consumer electronics... even steel (remember when that used to be Pittsburgh?).

China cranks out 38% of the world's cell phones. And half of the world's shoes. Plus most of the wooden furniture, video games, and televisions in the United States. But guess what happens when you take a look at the other side of the coin...

Is This the End of the American Miracle? We're feeling the China boom right here at home, too. But somehow it's not the same...

Here in the United States, American Metal Ware had made nearly 2.5 million pots in their Wisconsin factory... before they had to shut it down.

Chinese manufactures stole the design and cranked out copies at half the price.

To compete, Metal Ware had to move over to China.

Levi's were the all-American brand. They once had 63 U.S. plants. They just closed the last two and fired all the workers. Levi's will be made in China now.

Walt Disney was an all-American success story. But Disney's "Winnie the Pooh" dolls are made not here, but in the same place as Dr. Scholl's sandals and Foster Grant Sunglasses -- China.

How about Wilson tennis balls or Black & Decker drills? Silk flowers, sneakers, wood furniture, and hand-held "Game Boy" video games? All sold here, but all manufactured in... China.

A mind-blowing 80% of all the toys, bikes, and Christmas tree ornaments sold in the Unites States came from China. Along with 90% of the sporting goods and 95% of the shoes. Motorola spent over $1 billion moving operations from the US to China.

Thousands lost their jobs -- replaced by 10,000 Chinese workers in four new plants on the coast of the Yellow Sea. Look, there's nothing wrong with making money. And you can't fault anybody for just doing business and looking out for their own best interests. But at what cost? And whose expense?

A New Hampshire radio show made a public dare: "Take $400 an hour at Wal-Mart. Buy as many 'Made In America' goods as you can." Two listeners took the challenge. An hour later, they hit the checkout line with a basketful of 40 items. Guess how many actually were made in America? Just 10. It's no wonder. Sam Walton, Wal-Mart's founder, wrote an autobiography called "Made In America." But today, Wal-Mart alone imports a mind-blowing $12 billion of goods from China every year... That's more than China's trade with either Russia or the United Kingdom!

How did this happen? Beijing's Ugly SECRET #1: "Crush the Competition With Slave Labor!" Chinese workers average 61¢ an hour. US factory workers average $16 an hour. In other words, US workers make more in two weeks than most Chinese laborers make in a whole year! Nobody outside of China can compete with that. "We are beholden to the Chinese by our Treasuries. That worries me."

Carla Hills, Former U.S. trade representative China gets an endless supply of labor for just pennies. And there's a waiting list nearly 200 million people long to take over those jobs when the current workers drop from exhaustion (they work 12 hour days, 7 days a week). Moral or not, Beijing's slave-labor strategy does exactly what they hoped it would... It's sucked the life out of America's more costly industrial complex! Just check out the numbers: Over 450 U.S. companies are based in China. That's more than 10 times the number of U.S. companies there in 1990.

They've got combined annual sales of $23 billion. And more than 250,000 employees. In fact, U.S. investment in China is now a record $33 billion a year!

Meanwhile...

Nearly 2,250 American manufacturing jobs here in the Unites States have disappeared... every single day!

That's a not something new... it's been the trend day in and day out, over and over again... for 40 months straight!

What are the Chinese up to? They learned this trick from the Americans. Especially mega-rich superstars like Andrew Carnegie, John Rockefeller, and J. Pierpont Morgan. It's the genius strategy of any savvy monopoly maker: First, move in and CRUSH the competition with cutthroat pricing. Then... take away his business and leave him high and dry!

Thanks to slave labor, Chinese companies can crush U.S. competition with lots of cheap goods that USED to be made right here in America. In exchange, they not only get our purchases... they get our companies, when they're forced to pack up and move over to China so they can take advantage of the same cheap labor strategy. What's more, China also gets to send a whole new kind of export to America... Chinese STOCKS! And in return for that, they get billions more in investment capital. Straight from the trading accounts of private U.S. investors. Imagine. We're literally paying Beijing to "rip the heart" out of the U.S. heartland!

But it gets even better. Because that's only the FIRST dirty strategy engineered and overseen by Beijing. Here's the second... Beijing's Dirty SECRET #2:"Bait the Trap With Treasury Notes!" Another fallout from Beijing's supercheap labor strategy is America's massive trade deficit with China. It just keeps exploding.

As you can see in this chart, it's already passed a gap of over $120 billion. That means we actually BUY $120 billion more in goods from China than we manage to SELL to them. A household can't get rich... or stay rich... if it spends more than it takes in. Neither can a nation. Yet, no matter what we try to do to stop the gap from growing... weaken our dollars, create trade tariffs, perfect production and slash costs... America just can't keep up.

The trade deficit is now exploding $1.5 billion per day. Putting that in perspective... that means we spend an additional $1 million on Chinese products... every single passing minute! But that's not the worst part. Guess what China is doing with all that money?

° First, the money we send China gets reinvested in the PLA, China's massive military. (New reports say China has just built low-profile military bases on several disputed reefs in the Philippines!).

° Second, it goes back into funding more huge Chinese factories. With 200 million Chinese looking for jobs, China needs to build places for them to work! It also needs to buy HUGE stockpiles of raw resources to keep the factories running. ° Third, and most dangerous of all, the Chinese government uses a lot of their extra exporting income... to pile up an absolutely SICK number of U.S. Treasury bonds! That's right. China spends nearly $7.8 million an hour... or $187 million a day... snapping up US Treasuries and dollars.

The movers and shakers in China now hold the U.S. hostage to over $120 billion in Treasuries!

Now ask yourself: If it's obvious that U.S. interest rates have nowhere to go but up... if it's obvious the U.S. dollar has nowhere to go but down... and if it's obvious that Washington right now is literally spending America into oblivion...

Why would the Chinese government sock so much faith in U.S. treasuries?

Simple. It's not a vote in America's future at all. Instead, it's Beijing's way of backing America into a corner!

Think about it. The Feb. 5, 2004 Wall Street Journal has already reported that other Asian countries -- who altogether with China and Japan included -- hold an eye-popping $1.9 TRILLIONin U.S. foreign reserves -- are starting to dump U.S. debt. Korea and Thailand dumping is one thing. But when a massive holder like China stops buying U.S. debt and starts dumping, it's a much, MUCH bigger deal.

Pressure on U.S. bond yields will skyrocket. Other foreign investors will run from dollar-priced securities in a panic. Long interest-rates will jump. And U.S. consumers, businesses, and investors will get crushed in the jaws of a very powerful "Treasury Trap"!

It won't take more than a whisper - "sell." And that's your signal. I promised earlier to show you how to protect yourself from exactly this kind of disaster. And that's precisely what you'll discover in your FREE e-mail report "Total Profit Protection From the Coming China Crisis! " But before we dig into all that, let me share with you just one more piece of this sinister puzzle...

Beijing's Dangerous Strategy #3:"Lock the U.S. Dollar in a Death Struggle" To finance all its foreign debt, the United States has to spend a breathtaking $55 million per hour... or $1.3 billion per day... just to keep enough liquidity in the system to cover overseas interest-payment obligations.

Washington treats the Federal Reserve like a money machine: Walk up, punch the buttons on the printing press, and out comes the cash! Why? Because the more dollars there are, the less they're worth. And the less they're worth, the easier it is to cover those interest obligations without wincing. "America's growing reliance on high quality, low-price Chinese imports eventually might undermine the U.S. defense industrial base." US-China Security Review Commission Report

Trouble is, no government -- not even one as large as America's -- can keep up with that kind of program. Especially when you're overextended on your own personal spending budget by nearly half a trillion (with a "t") dollars! So just by holding U.S. Treasures, Beijing already has us trapped. But they haven't stopped there. China has ALSO hoarded piles and piles of ever-cheaper U.S .dollars. They've now got more than $310 billion in U.S .dollar reserves! Again, you have to ask: If U.S. dollars are backed by an overextended federal government... and if other major governments worldwide are already talking about switching reserves to gold and euros... if America's money isn't worth the paper it's printed on...

Why would China want to keep so much of their newfound wealth in the U.S. dollar, a currency that's already down more than 50% since October 2000? Again, it's simple. Since 1995, the Chinese currency -- the yuan -- has been pegged to the dollar at the weak exchange rate of 8.28 to the dollar. No matter how low the dollar goes, the yuan goes with it. So no matter how low the dollar goes... it's virtually impossible to close any currency-related trading gap we've got with China! It's like seeing how long two enemies can hold their breath under water. Whoever can withstand having a dirt-cheap currency the longest wins. But so far, judging just by the trading deficit, it looks like China is winning. And the U.S. is running out of options.

Could a stronger dollar shake loose the yuan's death grip? Not at all. This is how the sinister yuan strategy works. If the dollar rises, the yuan rises in lock step. If the dollar drops, so does the yuan. China's trading advantage never disappears... but we risk popping our own real estate bubble, slashing trade with Europe, and knocking the legs out from under stocks and bonds.

Meanwhile, China still has $310 billion in dollar reserves... which it can trade for euros or gold at any time... and use to throw the dollar into a final death spiral. When Beijing starts dumping, what follows could be worse for dollars than anything since Nixon broke with Bretton Woods in the 1970s.

Your FREE copy of "Total Profit Protection From the Coming China Crisis!" will also show you to protect yourself against this inevitable dollar collapse... with a strategies that can turnsevery $1,000 invested into as much as $78,400 or more. But first... Still wondering how or why all of this could have been a planned economic attack... rather than just an accident of free-market capitalism? Still think all this is a coincidence?

That's ok. But before you make up your mind to the contrary, you'd better read this... click here to continue . http://www.agora-inc.com/reports/DRI/china324/