De-Dollarization Accelerates - China/Russia Complete Currency Swap Agreement

Zero Hedge ^ | 9 Aug 14 | Tyler Durden

[SkyPilot]

The last 3 months have seen Russia's "de-dollarization" plans accelerate. First Gazprom clients shift to Euros and Renminbi, then the UK signs currency swap agreements with China, then NATO ally Turkey cuts ties and mulls de-dollarization, Switzerland jumps in the currency swap agreements, and BRICS create their own non-US-based funding vehicle, and then finally this week, Russia's oligarchs have shifted cash holdings to Hong Kong. But this week, as RT reports, Russian and Chinese central banks have agreed a draft currency swap agreement, which will allow them to increase trade in domestic currencies and cut the dependence on the US dollar in bilateral payments. “"The agreement will stimulate further development of direct trade in yuan and rubles on the domestic foreign exchange markets of Russia and China," the Russian regulator said.

As RT reports,

In early July, the Central Bank’s chairwoman Elvira Nabiullina said Moscow and Beijing were close to reaching an agreement on conducting swap operations in national currencies to boost trade. The deal was later discussed during her trip to China.

President Vladimir Putin, during his visit to Shanghai in May, said cooperation between Russian and Chinese banks was growing, and the two sides were set to continue developing the financial infrastructure.....

[catnipman]

“What I don’t understand is why the US buck is still high relative to other currencies.”

Because, sadly enough, despite the 99% decrease in value of the dollar since 1913, the dollar is still the most stable and valuable of the world’s major currencies.

However, the main thing propping up the dollar right now (aside from the short-term effects of massive Fed money manufacturing) is the fact that the U.S. dollar functions as a world currency. If enough of these various de-dollarization schemes succeed, the dollar collapse will be greatly accelerated from just the effects of Fed money printing alone.

[SkyPilot]

amen, and they only reason we are able “print” money is because the US Dollar is the world's Reserve Currency, and has been since the end of WW II. That privilege was bought and paid for by the blood of our military who fought and died. The US was they only remaining superpower at the end of WWII, and all nation's agreed on the Dollar as the reserve. That is about to change.

[VRW Conspirator]

How much longer do you expect this fantasy to last?

I hear you. I'd bet a dozen doughnuts that Obama and company will crash the economy, deliberately. It is like everything he is doing is vectoring to the point of collapse and chaos via Cloward-Piven.

[cherry]

if there were viable reasonable alternatives we would do it....

I remember clearly my younger brother talking about starting an IRA like 35 yrs ago....he said his finacial guy said one thing...."the govt doesn't give anything away for free"....

think about it.....all these years of dangling carrots in front of us, and all those synchophant "advisors" telling us to sing everything we got into our retirement....

you can't even withdraw all your money now without a big penalty/tax bill...

[cherry]

what do we do?...I know I know..invest in brass....but beyond that, is there anything else we could do?...anything to put our money into?

[SkyPilot]

All will take is a financial crisis that is but a few keystrokes away, and then Obama and his ilk will move in for the kill. They will seize IRAs and all retirement accounts. They have been planning it for years, modeled on South American actions. They will “give” you bonds in return. When the market drops, the panic sheeple will act grateful. Someone tell me I am wrong.

[SkyPilot]

Don’t trust in money......trust in God.

[SkyPilot]

Amen to #23.

[SunkenCiv]

China, Russia Sign CNY150 Billion Local-Currency Swap As Plunging Oil Prices Sting Putin