This is an interesting possibility:
I recently revealed that the so-called “BRICS+” countries will announce the creation of a new currency at its annual leaders’ summit conference on August 22–24.
This will be the biggest upheaval in international finance since 1971. It’s taking direct aim at the dollar.
Quite simply, the world is unprepared for this geopolitical shock wave.
It appears likely that the new BRICS+ currency will be linked to a weight of gold. This plays to the strengths of BRICS members Russia and China. These countries are the two largest gold producers in the world, and are ranked sixth and seventh respectively among the 100 nations with gold reserves.
One difficulty in considering the impact of the new BRICS currency on the dollar is that all dollar indexes compare currency to currency. But that’s meaningless since the dollar, euro and sterling could all suffer from a loss of confidence at the same time.
If gold goes from $2,000 to $10,000 per ounce, that is better understood as an 80% devaluation of the dollar: from 0.0005 ounces per dollar to 0.0001 ounces per dollar. That’s a collapse of confidence but you’ll miss it if you’re looking at euros or yen.
Those currencies will all be collapsing at the same time.
Yesterday Rachel and I were at the grocery store and noticed that canisters of Quaker Old Fashioned Oatmeal are now over $10 apiece.
We all know there are some serious problems with the dollar; however, its collapse has been prevented thus far by it being the global reserve currency, as well as being backed by the big stick of the US government.
Can you imagine money that is actually backed by something other than debt and empty promises? It wasn’t that long ago that it was. And it will be again.
If the BRICS+ nations are successful in creating a viable, non-weaponized alternative to the dollar, look out below.
8 comments
“If the BRICS+ nations are successful in creating a viable, non-weaponized alternative to the dollar, look out below.”
They’ve seen the success that the US has had weaponizing it’s own currency, why would they not do the same with theirs?
And given the national characters of Russia and China, the idea that they wouldn’t weaponize currency if given the chance is…incredible.
Yet it brings more prosperity to the nation if their currency is a fair medium of exchange. Once the US started seizing assets, etc., the game was up.
Russia isn’t stupid. They went through communism and out of it again.
What success? In seizing the private assets of other countries just because we disapproved of something their leadership did, we’ve sent a big neon signal to the rest of the world that the US is not a safe place to invest. Why do you think the BRICS countries are making their own currency and dropping the petro dollar? Weaponizing the dollar has torpedoed America’s privileged status, probably permanently.
Yes.
The BRICS (outside of Russia) have seriously bad histories of abusing their currencies by printing their way into massive inflation, and they all want out of the influence of IMF restrictions. It remains to be seen if they can commit to a new, gold backed currency and stick to it. An actual gold backed currency is not inflatable, and most of the BRICS have survived on printing money at need. If they don’t have that discipline then they just created a new fiat currency with only nominal value in gold. I am more interested in El Salvador and Central African Republic declaring bitcoin as legal tender. Both Gold and bitcoin could turn the world on its ear. Even though almost everything is denominated in dollars, I suspect there will be a bumpy ride no matter what.
I suppose the only thing to do is try to figure out what to do if the dollar collapses in purchasing power here, at the grocery store and gas pump.
Yes, the abuses have been there. I know the Muslim world was working on a gold Dinar and that was killed by military action before it could happen.
Sound money would be good for everyone.
“The BRICS (outside of Russia) have seriously bad histories of abusing their currencies by printing their way into massive inflation”
LOL because we would never do that here.
I was hoping seeds would be currency. Then again people would use non viable or old seeds or seeds from low quality plants because greed would over power quality checks on such things.