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Will The BRICS Dethrone The US Dollar?
Daniel Lacalle Blog ^ | 08/28/2023 | Daniel Lacalle

Posted on 08/28/2023 9:05:27 AM PDT by SeekAndFind

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1 posted on 08/28/2023 9:05:27 AM PDT by SeekAndFind
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To: SeekAndFind

free market currency will always be the back up currency of the world... the dollar deviating from that opens the door for others, but one controlled by china? hehehe, that’s a joke.


2 posted on 08/28/2023 9:10:51 AM PDT by teeman8r (Armageddon won't be pretty, but it's not like it's the end of the world or something )
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To: SeekAndFind

It will take a long time for these countries to dethrone the dollar simply on demographic levels alone they are headed for economic stagnation.

I see BRICS as a framework for these countries when economies become more regionalized after the eventual collapse the world will feel from these demographic bombs.

There are not enough kids in China, Russia, Brazil, ect. They are not wealthy enough nations to do what Japan is doing with investment economies either.


3 posted on 08/28/2023 9:11:57 AM PDT by Bayard
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To: SeekAndFind

The Ethiopia and South African diversity hires are hilarious.


4 posted on 08/28/2023 9:17:31 AM PDT by montag813
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To: SeekAndFind

BRICS is the Globalists’ back-up plan in case the plebes won’t submit to their Great Reset.


5 posted on 08/28/2023 9:18:57 AM PDT by Extremely Extreme Extremist
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To: SeekAndFind
--- "Will The BRICS Dethrone The US Dollar?"

Time will tell, but....

"...the euro is the greatest fiat monetary success in the post-Bretton Woods era; let us not deprive it of its merit." It affected us, and our Deutschmarks -- as a value related to the USD -- when converted automatically to the Euro, dropped in purchasing power rather quickly. So "success" is a word with different meaning to different people.

And it seems muddled to conclude, "The end of the U.S. dollar, if it comes, will not arrive through competition from another fiat currency, as the temptation of governments to destroy the purchasing power of the issued currency is too strong. It will probably come from independent currencies."

There will be NO "end of the U.S. dollar" as the phrase goes. There will likely come an end to the SWIFT system as the unipolar money transfer system, as competition is created and trade handled between non-US nations in other non-US currencies. Ditto for the Euro.

There will be a dollar, and likely a Euro unless the EU breaks apart and ECB debt challenged. But trade conducted in other currencies is the issue and likely coming reality.

Oddly, that is what I personally experienced decades ago, when I was paid in Pounds sterling, French and Belgian and Swiss francs, Guilders, Deutschmarks and more. I "traded" in multiple currencies. And sometimes brought currency between countries without the services of bank transfers. It should not be too far fetched to imagine the "past" being made "new" again.

With competition to the SWIFT system and BIC, the question is one simply of "economic sanctions" no longer being what these last very few decades have become -- weapons.

6 posted on 08/28/2023 9:19:07 AM PDT by Worldtraveler once upon a time (Degrow government)
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To: Bayard

Yes, the all poor countries like the BRICS have the same problem. Either you impose tight restrictions on your currency and limit its trading (like China and India) or your see regular cycles of hyperinflation and devaluation like Russia and Brazil.

They are all small boats on the sea that is the US dollar. Either they stay in port or accept being hit by storms.


7 posted on 08/28/2023 9:20:08 AM PDT by Renfrew (Muscovia delenda est)
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To: SeekAndFind

A basket of bad currencies is still not better than the dollar.

Honestly, they would be better off using Bitcoin.


8 posted on 08/28/2023 9:22:25 AM PDT by Vermont Lt
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To: SeekAndFind

No, but DemocRATs will.


9 posted on 08/28/2023 9:29:21 AM PDT by Da Coyote
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To: Vermont Lt
--- "...better off using Bitcoin."

Except the IMF and other global (US controlled entities) are gunning for Bitcoin and other cryptos....

"The regulatory fabric is being woven, and a pattern is expected to emerge. But the worry is that the longer this takes, the more national authorities will get locked into differing regulatory frameworks. This is why the IMF is calling for a global response that is (1) coordinated, so it can fill the regulatory gaps that arise from inherently cross-sector and cross-border issuance and ensure a level playing field; (2) consistent, so it aligns with mainstream regulatory approaches across the activity and risk spectrum; and (3) comprehensive, so it covers all actors and all aspects of the crypto ecosystem."

REGULATING CRYPTO
ADITYA NARAIN, MARINA MORETTI
IMF
SEPTEMBER 2022

Source: https://www.imf.org/en/Publications/fandd/issues/2022/09/Regulating-crypto-Narain-Moretti

It seems those not in favor of competition are actively working to quash competition.

10 posted on 08/28/2023 9:35:22 AM PDT by Worldtraveler once upon a time (Degrow government)
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To: Worldtraveler once upon a time

Good point, but even SWIFT isn’t that important. The main source of the dollars power is that any currency other than the USD comes with a certain risk premium.

If you are a corporation that sells around the world, you don’t want to hang on to rupees, reals, or rubles.

If you have a billion in reals sitting on your books you either
1) accept the risk that they could drop by 10% next month
2) Pay $50 million a month for a currency hedge to cover that danger
3) Dump them for USD or Euros as soon as you can

Almost every corporation chooses option 3, and there isn’t much that could change that.


11 posted on 08/28/2023 9:35:29 AM PDT by Renfrew (Muscovia delenda est)
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To: SeekAndFind

Before BRICS can dethrone the Dollar, they will have to settle on which currency they will use. The Yuan? The Rupee? The Ruble? The Euro? The Brazilian Dollar?


12 posted on 08/28/2023 9:39:48 AM PDT by Yo-Yo (Is the /Sarc tag really necessary? Pray for President Biden: Psalm 109:8)
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To: Worldtraveler once upon a time

For a currency to be a world currency there has to be enough of it. Originally, I thought the various BRICS countries would trade their own currencies for one backed by gold that they bought. But there seems to be no way to operationalize such a scheme. Who would supply the gold and at what price? Who would hold onto the gold and at what cost? Then there’s the politics. China wants the power that controlling BRICS would give them. India will fight that to the death. Russia is looking for a way to use BRICS in their war and nobody else in BRICS, including China, wants the knock-on effect of sanctions they’d get from the rest of the world for dealing with Russia. What comes to mind is two drunks helping each other cross the road. The weaker economies like Iran, Brazil and others, are simply looking for a free ride. This is a pointless diplomatic exercise.


13 posted on 08/28/2023 9:43:45 AM PDT by Gen.Blather (Wait! I said that out loud? )
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To: SeekAndFind

33 trillion in debt Hello!!! No our idiotic government dethroned it


14 posted on 08/28/2023 9:46:27 AM PDT by stanne
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To: Renfrew
Good points also, and yet...

"...the dollar's share of global foreign-exchange reserves fell below 59 percent in the final quarter of last year, extending a two-decade decline, according to the IMF's Currency Composition of Official Foreign Exchange Reserves data. In an example of the broader shift in the composition of foreign exchange reserves, the Bank of Israel recently unveiled a new strategy for its more than $200 billion of reserves. Beginning this year, it will reduce the share of US dollars and increase the portfolio's allocations to the Australian dollar, Canadian dollar, Chinese renminbi and Japanese yen."

"Dollar Dominance and the Rise of Nontraditional Reserve Currencies" IMF June 1, 2022

Source: https://www.imf.org/en/Blogs/Articles/2022/06/01/blog-dollar-dominance-and-the-rise-of-nontraditional-reserve-currencies

I think that the West -- includes us and our USD and Euro accounts (I also at one time had a UK account when I worked there) -- have done a foolish thing with "economic sanctions." When a contract -- trade is about contracts and trust after all -- becomes voided by some sort of "confiscation," as various kinds of recent sanctions, but also a long history of the nationalization of assets by socialist policies, then trust drops. We are closing our Euro account as the signs of recession grow there, and we want use of our assets close to us (and dispersed across a number of institutions and real estate), even as a recession might come here.

15 posted on 08/28/2023 9:47:27 AM PDT by Worldtraveler once upon a time (Degrow government)
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To: SeekAndFind

All fiat currencies are subject to political control and Lacalle writes an excellent article describing how the BRICS governments are worse and even more rapacious, then the US Government

BUT - the BRICS summit did not propose an alternative currency. Nothing even close. They pushed off consideration of it well into the future. So Western talk of it is just blather.

So what the BRICS really are doing is a vast PR exercise, combined with a loose political alliance. Its goals are limited at the moment - but they are nonetheless targeted at the US Empire.


16 posted on 08/28/2023 9:47:35 AM PDT by PGR88
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To: SeekAndFind

They’ve tried this before. One I remember was a “gold backed” effort with very alloyed “gold” coins. It fizzled.

The trouble is they want all the liberties of a fiat currency, but the stability of a gold backed one. So their own greed kills their scheme.


17 posted on 08/28/2023 9:51:54 AM PDT by yefragetuwrabrumuy ("All he had was a handgun. Why did you think that was a threat?" --Rittenhouse Prosecutor)
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To: stanne
33 trillion in debt Hello!!! No our idiotic government dethroned it

Indeed, and BRICS governments are even more controlling and political than even Fed.gov is.

BRICS are simply creating an informal alliance - waiting for the US to destroy itself. Our DC deep-state is indeed doing the job for them: going all-in with Ukraine, arresting former Presidents, promoting sexual degeneracy for political purposes, blowing-out government debt - all the BRICS have to do is sit back, watch our own woke-marxists tear the USA apart and protect themselves from the fall-out

18 posted on 08/28/2023 9:52:39 AM PDT by PGR88
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To: SeekAndFind
The Democrats will dethrone the US dollar. Indeed they have already started.

BRICS is not about fighting the USA. It's about preparing for the post-USA world as best they can. The key concept is not to get dragged down.

19 posted on 08/28/2023 9:53:04 AM PDT by Salman (It's not a slippery slope if it was part of the program all along. )
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To: SeekAndFind
Transcription error:

Meanwhile, in the U.S., the government may jeopardize the credibility of the U.S. dollar if it continues to generate deficits of two trillion dollars a year, more than a $14 billion estimated deficit by 2030, and with an increasing number of irresponsible advisers saying that it can create all the money it wants without risk.

Shouldn't that billion be trillion?

20 posted on 08/28/2023 9:56:49 AM PDT by Alas Babylon! (Repeal the Patriot Act; Abolish the DHS; reform FBI top to bottom!)
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