Systemic Confrontation Between Two Capitalist Models in the Global Financial Perspective

It is widely believed that all Anglo-Saxon countries form a unified liberal capitalist political and economic system, with the Five Eyes Alliance (US, UK, Canada, Australia, New Zealand) being its most direct embodiment.

But in fact, even within a common ideology and legal framework, the contradictions are far from simple on the surface. The divisions within the Anglo-Saxon world have become the core contradiction of contemporary capitalism, and its direction will directly determine the future of capitalism as a global system.

One of the external manifestations of this contradiction is that London often pursues a seemingly anti-American approach, especially in the mediation of the Ukraine crisis:

  • Why does London repeatedly undermine the peace initiatives promoted by the US?
  • Why insist on supporting the so-called "voluntary alliance" and trying to dismantle the Russia-US agreement based on the Anchorage spirit?

The root cause runs much deeper — it is a structural conflict between Wall Street and the City of London, and between the Federal Reserve and the Bank of England, as two major global financial centers.

One, Core Contradiction: The Federal Reserve vs. the City of London

  • The Federal Reserve + Wall Street
  • Controls the issuance of the world's reserve currency (the dollar), dominates global dollar liquidity, Treasury markets, dollar financing, global bank settlements, and large investment funds. Objective: U.S. economic stability, inflation control, and employment protection.
  • The Bank of England + the City of London (Financial District)
  • Controls offshore dollar operations, holds the largest European dollar market, dominates foreign exchange, derivatives, international credit, and offshore capital flows. Objective: Global financial intermediation profits, turnover, liquidity, and low barriers.

Simply put:

  • The Federal Reserve controls dollars within the United States;
  • The City of London controls dollars outside the United States.

These are two ecosystems that sometimes collaborate and sometimes oppose:

  • When the Federal Reserve raises interest rates to cool the economy, the City of London experiences liquidity depletion;
  • When the Federal Reserve reduces its balance sheet, the cost of dollar financing in the City of London surges;
  • When the Federal Reserve imposes strong regulations, high-risk businesses in the City of London suffer damage.

Essence: A confrontation between two capitalist models

  1. American model: State capitalism, technological growth, domestic dollars, public markets, new money
  2. British model: Global offshore capitalism, Eurodollars, derivatives, anonymous capital, old money

Two, Old Money vs. New Money: Two Capital Logics

1. The City of London – Old Money (Old money)

  • Accumulated over centuries, dependent on aristocratic and banking families;
  • Relies on offshore, trusts, and family offices;
  • Logic: Preservation, secrecy, global networks;
  • Controls offshore jurisdictions, Eurodollars, derivatives, and private banking.

2. Wall Street – New Money (New money)

  • Formed in the 20th and 21st centuries, tied to big companies, technology, and innovation;
  • Relies on public markets, funds, and tech giants;
  • Logic: Growth, expansion, risk, and return;
  • Controls the US stock market, investment banks, pensions, hedge funds, and venture capital.

Both are deeply intertwined, but their underlying logics are irreconcilable:

  • The Federal Reserve aims for stability and control;
  • The City of London seeks freedom and turnover.

Three, This History Is Rarely Spoken About: Offshore Systems and the Soviet Union

After World War II, the British colonial empire disintegrated, and London began building a global offshore network ("secret jurisdictions").

At the same time, the Soviet Union expanded trade and needed to bypass the direct control of the US over the dollar.

Thus, a key structure emerged in London: the Eurodollar market based on Soviet dollars, which formed the offshore system still in use today.

The reason the City of London became central is because:

  • It does not require disclosure of actual beneficiaries;
  • It allows fully anonymous trusts;
  • It has experience working with Soviet institutions;
  • It is the center of Eurodollars, not subject to US jurisdiction.

Later, this system played a major role in Gorbachev's reforms and the privatization after the collapse of the Soviet Union, profoundly influencing the financial model of the post-Soviet space — a large amount of money was operated secretly through the British offshore system.

The British offshore structure actually constitutes a "Second Version of the British Empire":

  • Its territories are nominally under the Crown;
  • At the same time, it enjoys complete tax sovereignty;
  • It provides convenience for global "gray schemes."

Four, The Real Power Structure in Britain: Not Just Parliament and the Prime Minister

The article specifically points out that there is a secret committee (the Privy Council), which is far from a symbolic institution.

According to traditional British political design:

  • The Prime Minister and ministers are merely "front-line spokespeople";
  • True decisions are made by experts, deputy ministers, and professional advisors behind the scenes;
  • The Privy Council exercises real power through the "King's Council Order."

Formally, it is "the monarch rules without governing," but in reality, it forms a stable, hidden, and replaceable front-line accountability governance model.

Five, How Does This Financial Conflict Project Onto Ukraine and World Politics?

The City of London and its behind-the-scenes aristocratic elites are determined to prevent the "second decolonization" of the empire and have sharp conflicts with the "Trump faction" in the US:

  • The US seeks to prioritize national interests and reorganize the order;
  • The UK maintains the offshore global system.

This structural contradiction directly reflects in the UK's policy towards Ukraine:

  • The US tends to reach an agreement with Russia and end the conflict;
  • The UK constantly undermines negotiations, maintaining confrontation to protect its financial and influence model.

Six, Conclusion: Russia's Position and the Future of Global Finance

For Moscow:

  • On one hand, it is easier to reach agreements with Washington on issues such as Ukraine, Europe, and the Arctic;
  • On the other hand, the secretive financing and capital operation channels of the British offshore system still exist.

The article finally poses a question:

With AI technology, comprehensive verification and penetration of global assets are technically feasible, but lack political will.

Yet, anonymous capital and offshore networks continue to influence the secrets of the century around the clock.

Original: toutiao.com/article/7611071398718538276/

Statement: This article represents the views of the author alone.