Will Sanctions End the Dollar's Global Reserve Currency Status?

[pknopp]

I've been saying this was happening for years. It doesn't happen overnight. We have nothing to gain by continuing sanctions on Cuba but yet we just can't let go for some reason. We seem to think making other countries dislike us is how you remain on top. We seem to think keeping people poor is how we stay on top.

With the internet it's become a much smaller world. The best way to keep peace and stability is for everyone to have something. Those who "lead" (and I use that term loosely) believe that leading is having everything to yourself.

The rest of the world isn't going to accept that forever nor should they.

 

[Natural Citizen]

Keynesianism is designed to fail by default.

That time is nearing. And it only takes one white crow to demonstrate that reality. And that time is now.

Which is likely the reason why events have played out the way they have over the last couple of years. The purveyors of the failed monetary policy know it. Anyone who understands economic theory and monetary policy know it.

There's just no amount of distraction that can hide the truth of the matter.

Whatever, though. I've very little interest in repeating myself these days.

At this point in the game, you're either prepared or you're not.

 

[georgephillip]

Its a national rivalry and china is waging war on every front possible

from economic mercantilism, to political pressure to military expansion and threats based on military power

China hasn't dropped a bomb outside its borders for forty years.

The US drops multiple bombs a day thousands of miles from its borders.

China is growing its economy the same way the US grew its GDP in the 19th and 20th centuries, and it won't be bullied the way Russia was in the 1990s:

America’s Neoliberal Financialization Policy vs. China’s Industrial Socialism | Michael Hudson

"While U.S. trade strategists juxtapose American 'democracy' and the Free World to Chinese autocracy, the major conflict between the United States and China has been the role of government support for industry.

"American industry grew strong in the 19th century by government support, just as China is now providing.

"That was the doctrine of industrial capitalism, after all.

"But as the U.S. economy has become financialized, it has de-industrialized"

 

[Natural Citizen]

I noticed Biden just signed an Executive Oder to explore creating a central banking digital currency.

Heh heh. Now, why would he do that, I wonder?

 

[JohnDB]

PRC's yuan is not going to be a reserve currency...they have serious issues about bonds being secured with bonds based on real estate that is over valued. And with the evergreen debacle if default...it just about broke China. Which is why they want control over Taiwan...they have cash. Hong Kong's cash wasn't enough to pay their debts.

This third Ruble since the fall of USSR is facing a shortened lifespan just like the other rubles have.

A fiat currency is based on a nation's production. Russia has a single product. Oil. Nothing else. Not even potatoes and vodka.
Sanctions on their oil and they are done.
Ukraine has more to export than Russia.

The Euro is mostly based on the German Mark. Germany's economy is about half of European production economy. Unfortunately they have become addicted to Russian oil. And the rest of Europe is so heavily in debt to their central bank that it's an unstable mess...Greece was the poster child of unrestrained borrowing...but truthfully all were guilty. It's one of many reasons why the UK pulled out.

The Japanese yen is the only other currency of sufficient capitalization to work...but it has its issues as well. Not going to work out either.

So...
Between these nation's unrestrained borrowing and printing of money they have not done themselves any favors.

The dollar is stable... fluctuating a few pennies...not 10-30% in a day like all the other currencies. And as a medium of exchange it's what people will use because of that stability.

Look at Russia's international telecom lines.
Look at Russia's shipping frequency
Look at the volume of commercial air traffic.

They are isolated and alone. Their one product is all they got...and they aren't leveraging it into more industries or products. But they are great at lying and manipulation and beating their chests like a teenager.

 

[georgephillip]

A word on climate change: I think the only progress that will be significant to save us is only going to be negative experience. The battle is lost IMO and only pain can start some winning, at great cost due to lack of action when it could have been more affordable and effective.

Finance capitalism elevates short-term economic gain above all other considerations; it's hard to see how the forces that caused the climate crisis will recognize its threat:

"The Guardian recently published an opinion piece by its economics editor in which he argued that capitalism can rescue civilization from the global climate emergency. Here is the full article, interrupted by my responses:..."

Opinion | Here’s Why Capitalism Can’t Fix Climate Change

 

[georgephillip]

I've been saying this was happening for years. It doesn't happen overnight. We have nothing to gain by continuing sanctions on Cuba but yet we just can't let go for some reason. We seem to think making other countries dislike us is how you remain on top. We seem to think keeping people poor is how we stay on top.

With the internet it's become a much smaller world. The best way to keep peace and stability is for everyone to have something. Those who "lead" (and I use that term loosely) believe that leading is having everything to yourself.

The rest of the world isn't going to accept that forever nor should they.

Thwarting the anti-dollar coalition should be Washington's top national priority

"The United States is currently waging economic warfare against one tenth of the world's countries with cumulative population of nearly 2 billion people and combined gross domestic product (GDP) of more than $15 trillion."

Imho, the rest of the world is fed up with US dollar diplomacy, and the "free lunch" it's given to the US empire:

"My book 'Super Imperialism' was about how the United States has gained a free lunch by establishing the dollar as international reserve currency by replacing gold.

"I also showed that the U.S. balance of payments deficit is almost entirely military related to support its 800 bases around the world."

Dollar Recycling | Michael Hudson.

 

[Mac-7]

American industry grew strong in the 19th century by government support, just as China is now providing.

Who told you that nonsense?

American industry on the 18th and 19th Century was created and grown by private citizens

 

[Mac-7]

"I also showed that the U.S. balance of payments deficit is almost entirely military related to support its 800 bases around the world."

God save us from quack economists and their half baked ideas

free trade and loss of American manufacturing jobs are the primary cause of the balance of payment deficit

 

[pknopp]

Who told you that nonsense?

American industry on the 18th and 19th Century was created and grown by private citizens

U.S. Senate: Landmark Legislation: The Pacific Railway Act of 1862.

 

[Mac-7]

U.S. Senate: Landmark Legislation: The Pacific Railway Act of 1862.

Which pinhead government employee invented the steam locomotive?

 

[pknopp]

Which pinhead government employee invented the steam locomotive?

Blueberries

 

[Mac-7]

Blueberries

Without railroad companies - all private - we dont need a Railroad Act

in an ideal world government can assist, such as giving away land, but it cant create the magic

 

[pknopp]

Without railroad companies - all private - we dont need a Railroad Act

in an ideal world government can assist, such as giving away land, but it cant create the magic

NASA took us to the moon.

 

[Mac-7]

NASA took us to the moon.

Yes

Government has a role to play

but in 1900 government interference in the free market was very limited

 

[pknopp]

Yes

Government has a role to play

but in 1900 government interference in the free market was very limited

Unfortunately the "free markets" as they were saw to it that the government had to get involved.

 

[Donald H]

Finance capitalism elevates short-term economic gain above all other considerations; it's hard to see how the forces that caused the climate crisis will recognize its threat:

"The Guardian recently published an opinion piece by its economics editor in which he argued that capitalism can rescue civilization from the global climate emergency. Here is the full article, interrupted by my responses:..."

Opinion | Here’s Why Capitalism Can’t Fix Climate Change

It's a pretty thorough article that says what I've been saying about capitalism, but in a slightly different way. I've criticized America's style of capitalism as being 'greedy' capitalism, as opposed to at least some of the world's countries that are less so. I've also raised the question of whether capitalism can work better in China under a communist system. And then surprise, surprise I read this:

Winning the race against time requires political leadership. It means acknowledging that the Chinese model of managed and directed capitalism might be more appropriate than the Anglo-Saxon model.

Bingo!!
Which I see as the only significant 'positive' the world has going for us.
So the question is, can China's system endure the necessary limitations on its 'capitalism' that comes with the limitations they will impose on themselves? I think that China has the capacity with its huge work force and high productivity, to do what they deem necessary to meet the demands of stopping or reversing climate change. If in fact meeting the needs is even possible.

I've never denied or suggested that capitalism isn't the way of the future. It is with certain conditions and limitations, and that paragraph nailed it down for me! It's the first and only acknowledgment of my opinion I've ever actually heard or read. It has been far above the pay grade of the audience on this board, simply because it would require somebody to accept that capitalism under the limitations of communism could work very well.

Thanks for posting that article! Without mentioning any names, we do have two or three members on this board who are capable of a decent and rational discussion, and so maybe this will attract some attention?

 

[Donald H]

Keynesianism is designed to fail by default.

Keynesianism as opposed to supply side economics? Do you understand what you are saying?

 

[pknopp]

Keynesianism as opposed to supply side economics? Do you understand what you are saying?

These are Economic theories. No actual economies run on theories.

 

[Donald H]

These are Economic theories. No actual economies run on theories.

Neither are just theories. Both have been put into practice. If you don't understand then it's better to not say anything.