Got a funny acronym anyway.
This talk of de-dollarizing the world economy as been around for quite a while. I recall some saying that was part of the reason Saddam Hussein was killed, because he wanted to promote use of other currencies. I won’t pretend to understand it all, I just recall the talk at that time.
Thanks Fed. Thanks Congress. Thanks voters. You thought the gravy train would go on forever.
Absolutely. All they need is a country willing to play the patsy - to absorb the cost of large and ongoing trade deficits. If China is willing to hollow out its industry in order to make the yuan a significant reserve currency, that should be entertaining to watch. Note that Germany, Japan and Switzerland, some of the candidates for reserve currency boltholes, have negative interest rates for this very reason - to discourage foreigners from parking their cash there. Reserve currency status artificially jacks up your currency and makes your exports less competitive.
BRICs could do it in theory. But the biggest problem they have is lack of trust. While they hold a third of the world’s population in just 4 countries. Those four countries don’t like each other. And more importantly, they don’t trust each other. So for them to throw in with each other at the expense of the western world would be to give China the upper hand on the currency. They may have their issues with the US, but none of them trust China. American borders have been virtually the same since the second world war. But China has grown with current skirmishes on every border they have including Russia and India. Each BRIC country has the strength to become a first world country on their own. And they are likely to do that. Or form alliances with neighboring countries or in India’s case with strategic counties.
ruble now worth less than a penny
No.
Next!
Throw in OPEC and all the nations caught in China’s Belt&Road trap, and you may have something. Given the pusillanimity of the West generally, anything is plausible.
Actually I expect this to be what causes WW3 depending on how it is resolved.
Russia, Brazil, and South Africa are going to drag China and India down.
A “nondollar global financial system” will remain a third world. BRICS need the dollar more than we need BRICS. The new new upper middle classes in BRICS make $20K/year and purchase American stuff: China: Levi jeans, whiskey. India: shampoo, Oreos. Etc. American would be fine without BRICS.