Backlash Against Weaponized Dollar Is Growing Across the World
Backlash Against Weaponized Dollar Is Growing Across the World
(Bloomberg) -- All around the world, a backlash is brewing against the hegemony of the US dollar.
It s been at least 50 years I've been reading that !
I'm no great friend of American foreign policy but I have to say they are by no means the only ones at it. Look at France with its two colonial Francs in Africa and the way China uses RMB internationally, especially in Africa again
The sanctions on Russia are deserved. Trying to apply those same sanctions to China would be incredibly difficult, especially because Europe wouldn’t back them.
Of course, if the US went to war because China attacked an ally, and they were invited to defend against an invasion, that changes the calculation. The aggressor bears the brunt of international sanctions.
Where were sanctions when American thugs raged 20 years of war in the Middle East?
I guess you would have to ask China and other superpowers.
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There would be no economic power to back up a UN currency, meaning it would be dependent on voluntary participation from the bulk of the member states' economies, which likely means that it would quickly devolve to either a protest currency used by anti-west regimes, a slightly federated version of the dollar that is responsive to the needs and desires of mainly the US and partially the EU, or it will be dropped/ignored by both the West and the Anti-west and become a currency of minimal value that is used only on the fringes of the world economy. The UN simply does not have the centralized capacity to operate a currency and enforce that currency's use amongst it's member states, especially those that already have a hegemony that would be threatened by such a currency
Largely this doesn't happen because the US dollar already serves as a good enough reserve currency. There's always been reserve currencies and unless the US abuses this power too much, there isn't any real demand for an alternative.
That's not really how currencies work. They are not just something arbitrary, they are a thing people trade which has value formed by supply and demand. People buy dollars to be able to buy things that are sold in dollars. Same goes for other currencies.
What would be the demand for UN currency? What can you buy with it? How would the price be determined?
The idea that USA somehow hugely benefits from having so much international trade done in dollars is also a bit weak. It does give them some international clout but that's about it. There are some very complicated things relating to trade balances involved when your currency is the global reserve currency.
Nobody is forcing people to use the US dollar. I mean, I know we Americans can be pretty brash and aggressive sometimes, but we won't invade you just for not using our currency.
Probably.
Global trade is conducted in US dollars, so they kind of are forced to use the dollar if they want to trade.
Not sure if you are sarcastic, but that is exactly what most wars US created were about.
Patriot moment
Gold backed currency?
Time for some good American freedom: Death
Saddam wanting to trade oil in other currencies was at least a part in the build up to the invasion of Iraq. The Petrodollar is still a large part of the US's financial strategy.
Petrodollar is a big incentive
This is why Obama wanted to end the Iran sanctions. Weaponization of the dollar is hurting US economy on the long run as more more country seek alternative methods of payment.
Fuck the dollar. Nobody knows why the Euro couldn't do shit to supplant it.
Fuck the dollar. Nobody knows why the Euro couldn’t do shit to supplant it.
I was designed so that it could not. One primary mechanism is that there are stricter limits to money printing with Euro. One needs money surpluses to send to the world if one wished it to be used in third party trade.
The only reason some of these countries are pushing for this is because they would like to be able to do what Russia did in Ukraine, without consequences.
Or they see that US has a economical nuclear bomb in the dollar and it's increasingly more reckless in it's use and they naturally want to isolate their economies from the fate that Washington just decides that they are not "free", "democratic" or somehow against US interest and decide to unilaterally sanction them and keep wrecking their economy until US demands are met. You do know that third of world's countries are under some sort of US sanctions and very few of them were or are on war footing towards anybody. World wants out of the dollar because US is no longer seen as reliable.
Meanwhile I know people in China who are very desperate to get their hands on USD, CAD, EUR, GBP etc.
Anedoctal evidence I know but I have a friend who has strained relations with his relatives in China because he refused to launder if you would call it that money. I think each person has a limit on the amount of money transferred.
I mean these people have never left China, why the hell do they need USD. Make what you wish but until the yuan becomes attractive to their own people other currencies are of no threat.
Because there are limits to how much money you can take out of China, and whenever there's a limit there's people trying to circumvent them? It's not rocket science.
Yes but that doesn't explain why they would need USD. For example I've only exchanged USD once and that was because I was going to a country where it was the legal tender.
I didn't exchange my life savings for it, 50,000 a year limit is high for someone who hasn't left China. I haven't even exchanged 10,000 in my lifetime let alone 50,000. I just keep it in AUD, USD is useless here.
So it points to me that they don't trust their currency which is what I'm getting at. A currency needs to be trusted by the countries people itself before it can be a threat to any of the established currencies.