Their NEXT MOVE is SHOCKING - MUST SEE!; US Sanctions on Russia May Sink the Dollar
Review of The Dollar Trap: How the U.S. Dollar Tightened Its Grip on Global Finance by Eswar S. Prasad - The Quarterly Journal of Austrian Economics
[If you don’t listen to the first part begin at 4 minutes and 55 seconds where he is speaking about the BRICS—Brazil, India, China and South Africa. - JRD]
Ecclesiastes 10:19 - Money (fiat debt) answer ALL things.
—
US Sanctions on Russia May Sink the Dollar
The US government’s decision to apply more sanctions on Russia is a grave mistake and will only escalate an already tense situation, ultimately harming the US economy itself. While the effect of sanctions on the dollar may not be appreciated in the short term, in the long run these sanctions are just another step toward the dollar’s eventual demise as the world’s reserve currency”
Another effect of sanctions is that Russia will grow closer to its BRICS (Brazil/Russia/India/China/South Africa) allies. These countries count over 40 percent of the world’s population, have a combined economic output almost equal to the US and EU, and have significant natural resources at their disposal. Russia is one of the world’s largest oil producers and supplies Europe with a large percent of its natural gas. Brazil has the second-largest industrial sector in the Americas and is the world’s largest exporter of ethanol. China is rich in mineral resources and is the world’s largest food producer. Already Russia and China are signing agreements to conduct their bilateral trade with their own national currencies rather than with the dollar, a trend which, if it spreads, will continue to erode the dollar’s position in international trade. Perhaps more importantly, China, Russia, and South Africa together produce nearly 40 percent of the world’s gold, which could play a role if the BRICS countries decide to establish a gold-backed currency to challenge the dollar.
“The US government has always relied on the cooperation of other countries to maintain the dollar’s preeminent position. But international patience is wearing thin, especially as the carrot-and-stick approach of recent decades has become all stick and no carrot. If President Obama and his successors continue with their heavy-handed approach of levying sanctions against every country that does something US policymakers don’t like, it will only lead to more countries shunning the dollar and accelerating the dollar’s slide into irrelevance.”
Open link for complete article
—
Review of The Dollar Trap: How the U.S. Dollar Tightened Its Grip on Global Finance by Eswar S. Prasad - The Quarterly Journal of Austrian Economics
Prasad nicely details this conflict. The chief protagonists are the U.S., the Euro zone, along with the developing world, principally the so-called BRICS nations, which include Brazil, Russia, India, China, and South Africa. Echoing all the discussion of late concerning the renminbi’s ascent in currency markets, China looms large in Prasad’s account, due to that country’s size, rapid economic growth, and geopolitical ambitions. As the leading player, the U.S. dollar attained its status in the 20th century, assuming it from the British pound that dominated in the 19th century, and consolidating it after World War II with the establishment of Bretton Woods. When this exchange rate system fell apart with Nixon’s 1971 decision to abandon gold, one might have expected the US dollar to lose its preeminence. That it instead gained influence Prasad explains by observing that everything is relative in international finance. Though the U.S. government effectively devalued its currency with respect to gold, what mattered for the dollar henceforth was how it stood compared to other fiat currencies in the eyes of investors, businesses, central banks, and governments.
Open link for complete Journal article
—
SEE: