“the Federal Reserve is able to flood our financial system with dollars without it causing a tremendous amount of inflation because the rest of the world ends up soaking up a lot of those dollars. But now that is changing. China and Russia have been spearheading a movement to shift away from using the U.S. dollar in international trade. At the moment, the shift is happening gradually, but at some point a tipping point will come (for example if Saudi Arabia were to declare that it will no longer take U.S. dollars for oil) and the entire global financial system is going to change.”
http://www.wealthwire.com/news/global/3825
absolutely. This is what many Americans simply do not realize. There are gigatons of US Dollars sitting out there in foreign nations vaults because we have the world’s reserve currency.
If that changes, why would they keep them? And if they don’t keep them, guess where they are going to run? HOME, that is where! They are going to come flooding in from all over the world and it is going to make the Weimar inflation look like a walk in the park.
When we go screwing around with these nations who hold huge dollar reserves (and Treasury bonds which are dollar substitutes in essence), it is like sticking a loaded gun