Currency Wars_ The Making of the Next Global Crisis - James Rickards [9]
As with a lot of Wall Street folks I had recruited for help on national security projects, he grasped the situation immediately and could not wait to volunteer. After running it by his bosses at UBS, he called me back a few days later. “I’m in,” he said. “Just tell me where I need to be. This’ll be great to mix things up with the generals and intelligence people. Can’t wait.” And that was that.
Steve was assigned to the Russia cell, of course. O.D. was assigned to the gray cell, representing the hedge funds and Swiss banks—another appropriate assignment. I was put in the China cell, along with a well-known Harvard academic, a highly cerebral RAND Corporation analyst and two other area experts.
The financial war was just a few weeks away and it was time to lay some traps—something the military calls “conditioning the battle space.” I knew that Russia would begin the game with significantly less national power than the United States or even China. In fact, the national power assessment showed Russia having about only two-thirds the strength of the United States, with China somewhere between the two. As far as I was concerned, this just meant that Russia would have to play smarter and harder and do something unconventional to set the United States back on its heels. As an American concerned about the economic course we were on and our vulnerabilities to financial attack, I wanted the United States to suffer some kind of shock or setback in the game environment. That seemed like the best way to do our jobs for America and open some eyes at the Defense Department and in the intelligence community before a serious setback took place in the real world. The fact that Steve, O.D. and I were playing non-U.S. teams left us in a position to deliver a shock. The fact that we had less national power to start with just meant that we would have to be more creative—and more stealthy.
Ten Twenty Post is a popular bistro in Darien, Connecticut, near where I live and not far from Steve’s home in Westchester County, New York. It’s also become a hangout for investment bankers from RBS and UBS in nearby Stamford. With its mahogany bar, brass fixtures, glass chandeliers and white tablecloths, it conjures up the look and feel of a classic French original. I suggested to Steve that we meet there for dinner one week before the game to work out a scheme to put the United States on the defensive.
Over oysters, white wine and vodka toasts of Na zdrovyeh!, we reminisced a little about our Moscow adventures and then got down to business. I handed Steve a mock press release from the Russian Central Bank, something I had written earlier and used in a few articles and lectures. It said that Russia was moving its gold to Switzerland and starting a new bank in London. The bank would issue a new form of gold-backed currency supported by gold in the Swiss vaults. Initially Russia would own all of the new currency. But everyone would be free to deposit gold and receive similar currency. It had other technical features to make the plan feasible, such as lending and clearing facilities. The kicker was that, from now on, any Russian exports of oil or natural gas would have to be paid for in the new currency. U.S. dollars would no longer be welcome.
“Jim, I’m