Venezuela Ditches US Dollar, Will Use Euros For International Trade

https://www.zerohedge.com/sites/default/files/inline-images/2018.10.16maduro.JPG?itok=AB1s7Cl2

 

Venezuela has just taken the next step in its quest to “free” itself from the tyranny of US dollar hegemony. One year after the country said it would stop accepting US dollars as payment for its (ever shrinking) oil exports (saying the country’s state-run oil company would accept payment in yuan instead), Venezuelan Vice President for Economy Tareck El Aissami said Tuesday that Venezuela will officially purge the dollar from its exchange market in favor of euros. Continue reading

The World Is Ganging up Against the Dollar

https://dweaay7e22a7h.cloudfront.net/wp-content_3/uploads/2018/08/shutterstock_1141332971.jpg

Shutterstock

 

The U.S. has been highly successful at pursuing financial warfare, including sanctions. But for every action, there is an equal and opposite reaction.

As the U.S. wields the dollar weapon more frequently, the rest of the world works harder to shun the dollar completely.

I’ve been warning for years about efforts of nations like Russia and China to escape what they call “dollar hegemony” and create a new financial system that does not depend on the dollar and helps them get out from under dollar-based economic sanctions.

These efforts are only increasing. Continue reading

De-Dollarization Continues: China, Iran To Eliminate Greenback From Bilateral Trade

 

The more Washington lashes out in anger at those who will not bow to the unipolar world order, the more the rest of the world fights back. As the launch of its Yuan/Gold-settled oil futures loomsChina is escalating its de-dollarization scheme further by seeking a bilateral rial-yuan agreement with Iran.

As a reminder, nothing lasts forever… Continue reading

The Chinese ARE Dumping our Treasury Bonds

We warned about this in our Pentagon research back in late 2008 and early 2009 but there were plenty of skeptics. We emphasized the risk in the 2012 NY Times bestseller, Secret Weapon. In Chapter 9, we made a strong case that China could dump their Treasury bond holdings and work fervently to establish the Yuan as a reserve currency alternative to the American dollar. We pointed out how multiple Chinese sources were planning for this and labeled it “financial warfare.” We made it clear that this would prove deflationary for China but said “If China can tolerate such deflation and if it can transition effectively, it will be sitting in the shade.”

While we knew then that the time had not yet arrived for China to make her move, we also knew it was just a matter of time. Starting in 2011, we began to address the risk of financial warfare in this Blog. Just look back at this February 2011 post where we argued that China had a long-term view and a five-year plan:

The Chinese Take a Long Term View; Evaluating Their 5YP Continue reading

The Next Empire

What this essentially means is that the sword is coming from multiple fronts against America and it is unavoidable at this point. We are watching a new chapter in world history unfold before our eyes. Pax Americana will go into the history books as a new empire takes shape and fills in the vacuum. The only thing that can turn America around at this point is turning back to God after repentance.

 

The Next Empire

 

Throughout history, political, financial, and military leaders have sought to create empires. Westerners often think of ancient Rome as the first empire. Later, other empires formed for a time. Spain became an empire, courtesy of its Armada, its conquest of the New World, and the gold and silver extracted from the West. Great Britain owned the 19th century but lost its empire due largely to costly wars. The US took over in the 20th century and, like Rome, rose as a republic, with minimal central control, but is now crumbling under its own governmental weight.

Invariably, the last people to understand the collapse of an empire are those who live within it. As a British subject, I remember my younger years, when, even though the British Empire was well and truly over, many of my fellow Brits were still behaving in a pompous manner as though British “superiority” still existed. Not so, today. (You can only pretend for so long.)

But this does suggest that those who live within the present empire—the US—will be the last to truly understand that the game is all but over. Americans seem to be hopeful that the dramatic decline is a temporary setback from which they will rebound.

Not likely. Historically, once an empire has been shot from its perch, it’s replaced by a rising power—one that’s more productive and more forward thinking in every way. Yet the US is hanging on tenaciously, and like any dying empire, its leaders are becoming increasingly ruthless, both at home and abroad, hoping to keep up appearances.

Continue reading

Russia Abandons PetroDollar By Opening Reserve Fund

2015 has not been good to Russia; the spread between Brent and WTI is gone in anticipation of US exports and both benchmarks have flirted with sub $45 prices. A hostage to such prices, the ruble has yet to begin its turnaround and the state’s finances are in extreme disarray. President Vladimir Putin’s approval ratings remain sky-high, but his country has not faced such difficult times since he took office more than 15 years ago.

Since the turn of the new year the ruble has fallen over 13 percent and Russia’s central bank and finance department are running out of options – to date, policy makers have hiked interest rates to their highest level since the 1998 Russian financial crisis and embarked on a 1 trillion-ruble ($15 billion) bank recapitalization plan to little effect. Their latest, and most dramatic, plan is to abandon the dollar – at least somewhat. Continue reading

France hits out at dollar dominance in international transactions

France’s political and business establishment has hit out against the hegemony of the dollar in international transactions after U.S. authorities fined BNP Paribas $9 billion for helping countries avoid sanctions.

Michel Sapin, the French finance minister, called for a “rebalancing” of the currencies used for global payments, saying the BNP Paribas case should “make us realize the necessity of using a variety of currencies”.

He said, in an interview with the Financial Times on the sidelines of a weekend economics conference: “We [Europeans] are selling to ourselves in dollars, for instance when we sell planes. Is that necessary? I don’t think so. I think a rebalancing is possible and necessary, not just regarding the euro but also for the big currencies of the emerging countries, which account for more and more of global trade.”

Christophe de Margerie, the chief executive of Total, France’s biggest company by market capitalization, said he saw no reason for oil purchases to be made in dollars, even if the benchmark price in dollars was likely to remain. Continue reading

Jim Sinclair: Russia is one move away from collapsing U.S. economy

On March 17, commodities adviser Jim Sinclair spoke in an interview with Greg Hunter of USA Watchdog on gold, the markets, and ongoing events taking place between the U.S. and Russia over Ukraine. During the 30 minute interview, Sinclair laid out a chilling scenario where Russia has positioned themselves to be one move away from collapsing the U.S. economy, and that one wrong move by President Obama could set the entire scenario in motion.

Jim Sinclair: To sanction Russia is to forget that Russia supplies Europe with its gas supplies. I honestly believe sanctioning Russia is the same as shooting yourself in the foot.

Greg Hunter: So Russia could not only say hey, we want gold for our payment (oil), but they could say, hey… we want you to pay us in rubles.

JS: Or pay us in anything. Also, it makes energy cheaper. Why would anyone want to pay in dollars if they can pay in their own currency? Continue reading

Ned Goodman:The dollar is about to be dethroned as the world’s de facto currency (Video)

The Fed will very likely never ‘taper’.  If so, there will be a bond sell off which would quickly spiral out of control. Quantitative easing, or QE, will be permanent until it eventually causes a collapse.

The Fed not tapering is also supported by Egon von Greyerz, the founder of Matterhorn Asset Management in Switzerland, in an interview just two days ago.

The ‘day of reckoning’ is indeed coming. The question is not if, but when.

On Sept. 15, Canadian billionaire Ned Goodman spoke at the Cambridge House regarding the U.S. dollar, and the state of the Western economies. In his nearly eight minute speech, the 75 year old CEO of Dundee Capital Markets and Chancellor of Brock University painted a picture of the upcoming change in reserve currency control by the U.S., and how the dollar will soon be replaced as nations around the world rush to get rid of their currency reserves.

Ned Goodman: In my view, the dollar is about to become dethroned as the world’s de facto currency. I’ll tell you how I came to that conclusion so quickly… the new President of China, Xi Jinping, his first visit on the day of his becoming President, was at his request to meet with Mr. Putin. And he immediately made a deal with Mr. Putin to get all the oil that he needs, which he can buy in Renminbi.

We’re headed to a period of stagflation, maybe serious inflation, but stagflation for sure, and the United States will be losing the privilege to print at its will, the world’s reserve currency. A period that’s going to be very inflationary, and I can tell you that before that happens, it is likely that it is going to get quite ugly. – Ned Goodman, Cambridge House Continue reading