The entire edifice of the US economy is supported right now by the status of the USD/FRN as the international trade currency.
When the Federal Reserve Note (US Dollar) loses its privileged trade status, we can expect a massive one-time hyperinflation, I estimate on the order of 300%-500%, as well as a vicious crash in the U.S. economy.
The recent Russia-China trade agreement moves us another big step towards that day.
Notice that the elevation of the Chinese currency to international reserve status is the EXPLICIT policy of the Chinese government. Judging by the policies of the Fed Reserve and US Congress, losing reserve status for the dollar appears to be the policy of the American government as well....
As reported last Friday:
Russia and China will switch to trade in rubles and yuan to boost bilateral trade and economic cooperation, following an agreement signed between the central banks of both countries, Russian Central Bank Deputy Chairman Viktor Melnikov said on Thursday.
People's Bank of China Deputy Chairman Ma Delun said the agreement would give the two nations the opportunity to increase the value of deals in their national currencies and "help bring them closer to international reserve currencies."
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1 comment:
You're probably wrong about this, but 300-500% hyperinflation would go a long way toward a debt jubilee - so it's not like there's no upside.
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