Part 4: The Great Reset — From America to Israel

← Back to Part 1: The Boom-Bust Lie

The BIS — The Central Bank of Central Banks

ExpandThe BIS building in Basel, Switzerland — the Bank of International Settlements, the central bank above all central banks

Every nation has a central bank (the Fed, Bank of England, Bank of Japan, etc.). But there is one institution above all of them: the Bank of International Settlements in Basel, Switzerland.

The BIS was founded in 1930, ostensibly to manage German war reparations from World War I. It became the coordination mechanism for all central banks globally — setting standards, facilitating payments, and aligning policy across the entire international banking system.

The BIS is not accountable to any elected government. It is immune from taxation and from national law. Its owners are the central banks themselves — and through them, ultimately, the private financial institutions that control those central banks.

The Nazi Connection

Adam LeBor's book Tower of Basel — buy on Amazon ↗ — documents a remarkable fact: the BIS continued operating throughout World War II, facilitating transactions for Nazi Germany.

As quoted in the lecture:

"Nazi Germany needed a financial channel to the neutral countries — it ran through Basel, which is the main reason why Nazi Germany did not invade Switzerland or Sweden. These neutral countries were far more useful to the Third Reich as monetary hubs on the transnational financial network than as extra swaths of German-controlled territory."

In other words: transnational capital helped fund the Nazi war machine — not out of ideology, but because it was profitable. After Germany's defeat, the Bretton Woods conference (1944) almost shut down the BIS for collaborating with the Nazis. It survived, and subsequently grew more powerful.

The BIS After World War II

The Marshall Plan, which rebuilt Europe after WWII, is taught as American generosity. But as quoted in the lecture from Tower of Basel:

"Marshall Aid came at a price: remodeling European societies on the American model of consumerism and consumption... The American dream — a house in the suburbs, a car, and numerous household appliances — was projected as a near-guaranteed benefit of American-styled freedom. The key to this was increased productivity on American-style production lines in a transnational free market. For that to happen and for the money to flow freely, new mechanisms of international payment had to be constructed with the BIS at the center."

Translation: the reconstruction of Europe was designed to create new markets for American goods, embed consumerism as a cultural value, and build the BIS-centered payment infrastructure that transnational capital needed to operate globally.

How China Was Engineered to Rise

ExpandShanghai's Pudong skyline — China built entire cities and the world's largest high-speed rail network in under two decades

The Post-2008 Problem

After 2008, the global economy was in serious trouble. America had lost trillions. Europe was in crisis. The financial system needed a new engine of growth.

Transnational capital's solution: engineer China's rise.

The mechanism: the exchange rate.

The Exchange Rate as a Signaling Mechanism

The interest rate coordinates banks within a national economy. The exchange rate coordinates trade between national economies.

Think of it this way: if China's currency (the renminbi/yuan) strengthens against the dollar, Chinese goods become more expensive for foreign buyers — but China can buy more from the world with its currency. A stronger yuan signals: trade with China. Sell to China.

Starting around 2008 — precisely when American and European economies were collapsing — the yuan began a sustained appreciation against the dollar. This was not a market accident. It was a coordinated signal from the BIS: the center of gravity is shifting to China.

China's Banking Explosion

The result was one of the most dramatic expansions of a banking system in history. Between 2008 and 2020, China's bank assets grew from roughly comparable to the US to dwarfing every other national banking system.

Today, the four largest banks in the world by assets are all Chinese:

China's Manufacturing Dominance

Alongside banking, China became the world's factory. In 2000, the US dominated global manufacturing exports. By 2024, China supplies virtually every country on earth.

This shift was deliberate. The BIS, by manipulating the exchange rate signal, directed global trade flows toward China — giving China the resources and revenue to build its economy at unprecedented speed.

Why China Didn't Become the Hegemon

The theory was: shift capital and manufacturing from America to China, make China the new center of the global system. It didn't fully work. Two reasons:

China doesn't want the job. Being the global hegemon means maintaining military bases in 80+ countries, absorbing global instability, running expensive alliances, and subsidizing the world trading system. The US spends roughly $800B/year on defense to maintain this role. China has no interest in this burden.

America won't allow it. As Chinese manufacturing expanded globally, the US responded with tariffs (under both Trump and Biden), technology export restrictions (blocking Huawei, restricting chip sales), and political pressure on allies to exclude Chinese companies.

The attempted transition stalled. Transnational capital needs a new destination.

America's Three Problems

For transnational capital to leave a host, the host must show signs of declining return. Jiang identifies three.

1. Aging Elite

America's financial and political leadership is aging. Older elites are less entrepreneurial, less willing to take bold risks, less capable of generating the aggressive economic activity that produces returns for capital. The energy and innovation that made America the center of global capitalism is declining.

2. Quantitative Easing — Too Much Money

Quantitative easing (QE) is when a central bank creates new money and uses it to buy assets (bonds, mortgage-backed securities) to inject liquidity into the economy. The Fed deployed QE massively after 2008 and again during COVID.

The result: an economy flooded with cheap money. When capital is too cheap and too abundant, it flows not into productive investment but into speculation — meme stocks, cryptocurrency, leveraged buyouts, AI hype. The economy gambles rather than builds.

3. Military Decline

America's military dominance — the foundation of its ability to enforce the global dollar system — is showing cracks. Recent conflicts (Afghanistan, Iraq, and now the situation in Iran) suggest that American military power is less effective than assumed. A financial system backed by military enforcement only works as long as the military enforcement is credible.

Engineering the Collapse — and the Shift to Israel

Why Collapse First?

When transnational capital exits a host economy, it doesn't just quietly withdraw. It engineers a financial crisis on the way out, for two reasons:

1. Exit with maximum value — A collapse allows capital to convert investments to cash at peak valuations before the crash, then rebuy assets at collapsed prices
2. Acquire distressed assets — After the collapse, water rights, oil infrastructure, farmland, media companies, and other real assets can be purchased for cents on the dollar

This is the same playbook as 2008: collapse the system, buy up what's left cheaply. The difference is scale — this time, it may be the entire American economy.

Why Israel?

After China, the next candidate for receiving transnational capital is, in Jiang's analysis, Israel. Three reasons:

1. Wars Are Profitable — And Israel Will Keep Fighting

The Greater Israel Project refers to expansionist territorial goals in the region. Whether or not one agrees with the political framing, ongoing conflict generates enormous demand for weapons, logistics, intelligence, and finance — all of which produce returns for capital.

2. Reconstruction Requires Capital

After destruction comes rebuilding. Post-conflict reconstruction — infrastructure, housing, utilities, telecommunications — requires massive capital investment. The Middle East has been systematically destabilized. Rebuilding it will generate enormous returns for whoever controls the capital flows.

3. Geographic Control of Global Trade

Israel sits at the intersection of Europe, Asia, and Africa. Through influence over key shipping lanes and African trade relationships, it could become a hub for global trade — the same role that made the Dutch Republic, then Britain, then America the center of the global financial system.

America After the Collapse — The Parasite Leaves the Host

Why Would Americans Allow This?

A student asked the obvious question: if America knows transnational capital is leaving, why allow it?

Jiang's answer is nuanced. It's not that Americans are allowing it — it's that some Americans actively want it.

Economic collapse will be enormously painful for ordinary Americans. Wealth destruction. Potential civil unrest. Years or decades of hardship. This is not a painless transition.

But there is a strand of American thinking — associated with figures like Donald Trump and the "Make America Great Again" movement — that believes this pain is necessary. The argument:

Transnational capital is a parasite on the American host. It profits from America's military, uses America's dollar as the reserve currency, and enjoys the stability America provides — but pays minimal taxes, moves jobs overseas, funds foreign governments, and undermines American workers.

Getting rid of it is like chemotherapy: brutal, painful, destructive in the short term — but necessary to kill the cancer so the host can recover.

"To get rid of parasites, it's a painful, painful process. It's like cancer treatment — chemotherapy, surgery, crappy food. But if you want to be healthy, you have to go through it." — Jiang Xueqin

The Long-Term Thesis

Once transnational capital exits:

• America is freed from the obligation to maintain global military bases for capital's benefit
• The dollar can be devalued without destroying the global system (because the system will have moved)
• America can rebuild a productive, manufacturing-based economy with higher wages and less financialization
• American foreign policy can focus on actual American interests rather than global capital flows

This is not guaranteed. It may not happen. But it is the framework within which figures like Trump are operating — whether consciously or intuitively.

Summary: The Full Timeline

The core argument of this lecture in one sentence: the boom-bust cycle is not gravity — it is a mechanism by which those who control the central banking system transfer wealth upward during the bust phase, while blaming natural forces for what is, in fact, engineered.