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Are Western Sanctions Accelerating The Fall Of The Dollar?

  • The BRICS nations, representing a significant portion of the global population and GDP, pose a challenge to Western economic power.
  • Rising US Treasury bond yields and an unstable economy signal potential downfall for the US as the leading global economic superpower.
  • Sanctions imposed by the West, especially on Russia, accelerate the global push towards de-dollarization, potentially threatening the dollar's role as the world's reserve currency.

The BRICS summit is underway with talk of expanding the economic block and speculation about a “new currency.” Peter Schiff appeared on Real America with Dan Ball to talk about these developments, saying the BRICS nations will blunt Western dominance.

Brazil, Russia, India, China, and South Africa make up the BRICS block. It accounts for about 40% of the global population and a quarter of the global GDP. Peter pointed out that not only does the BRICS block supply a lot of goods to America, but it also loans the US a lot of money.

The interest that we have to pay on that debt is soaring.”

Peter noted that Treasury bond yields were at the highest level in 16 years. That’s a big problem when you have a $32.7 trillion national debt and massive budget deficits month after month.

This backup in the yield on the 30-year Treasury — mortgage rates are going to hit 8% pretty soon. Think about that for a minute. When was the last time anybody was looking at an 8% mortgage? Just a year ago, they were in the threes. So, everybody is going to be paying more.”

And things don’t appear to be on track to get any better.

We are broke as a nation, and the inflation genie is out of the bottle. We’ve had more than 10 years of reckless money printing. There’s no way these rate hikes are going to do anything about that. So, high inflation is here to stay. And it’s going to get even higher.”

President Biden keeps saying the economy is strong. Peter asked how he could make that assertion.

We’re the world’s biggest debtor nation. We have record trade deficits, record budget deficits, and inflation that’s about to run out of control. I don’t think the economy has ever been this weak.”

Given the current state and the trajectory of the economy, the US is ripe to fall from its perch as the world’s economic superpower. And the BRICS block is in a position to further undermine the American economy.

Dan said he thinks the West’s response to Russia’s invasion of Ukraine pushed the BRICS nations into a corner and forced them to look more closely at an alternative to the US dollar. Peter said he agreed.

The blowback from those sanctions is going to be a disaster.”

When the Biden administration started imposing sanctions, we reported that there were possible long-term consequences for using the dollar as a tool for war — that it could accelerate de-dollarization globally and even threaten the dollar’s role as the world’s reserve currency. As Peter explained, this would be a gut punch for the US economy.

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The US really depends on the dollar as the reserve currency. But what we did with those sanctions — we gave the world a powerful reason not to want to be a part of that system anymore because we demonstrated the downside, the risk that you take in holding dollars and being part of this dollar payment system. We gave everybody another reason, as if they needed more, to de-dollarize. So, that whole process has been sped up. The last thing we should have done was punish Russia for doing exactly what we wanted them to do. We wanted Russia to hold dollars because that benefits us. That keeps our prices down. That keeps our interest rates down. And then we punished Russia for doing exactly what we wanted them to do. Now, what kind of message are we sending to the rest of the world?”

By SchiffGold.com via Zerohedge.com

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  • Mamdouh Salameh on August 24 2023 said:
    For peoples of the world, the dollar has become synonymous with sanctions, US hegemony, political arrogance, oppression, conflicts and wars and US self-interest. In a nutshell, it has become the ugly face of capitalism.

    That is why countries of the world are moving away from the US dollar in droves in what could be seen as a global drive for de-dollarization. The BRICS countries (Brazil, Russia, India, China and South Africa) are accelerating this shift by inviting major countries to join them, accelerating the transformation of the World Order from a unipolar system led by the US into a fairer and more equitable multipolar one and creating the means to undermine the US financial system.

    America’s economy is broke with record trade deficits, record budget deficits, a weak banking system and inflation that is about to run out of control. The reckless money printing won’t save the US economy. The game is over.

    By 2030, the yuan will be the top reserve currency of the world and the petro-yuan the dominant oil currency along with a few others. By then the US dollar would have lost one third to one half of its value.

    My advice to investors is to drop the dollar in favour of gold, stronger currencies and real estate.

    Dr Mamdouh G Salameh
    International Oil Economist
    Global Energy Expert
  • DoRight Deikins on August 24 2023 said:
    I'm not an economist, but I do live in a 3rd world country. Perhaps this is the call that will bring the US back from something far worse than financial bankruptcy --> moral bankruptcy. Not to say the rest of the world is better, but the US was given a mandate to lead. We have used that to lead to materialism and self-aggrandizement. And yes, MAGA was just more of the same.

    The chickens are about to come home to roost.
  • Jeff Boyd on August 26 2023 said:
    So what does this mean about the world now?
    The USA who saved the world somewhat after WW2 with rebuilding and bringing new countries into democracy is now a pariah economically?
    The past presidents starting with Reagan have just added to this debt by the billions then trillions which just builds upon itself!
    Now these pathetic countries like China and Russia want to control the world&#039;s currency. Wait till the other countries find out how they will do this using their own form of currency or BRICS!
    We are to blame for our own debt however but how many counties have we tried to help stand up economically by helping them with loans and other fiscal means? Now we are the BAD GUYS for wanting a better world unfortunately using the dollar as a weapon. So be it!
    When &amp; IF we fall the world will find out how these BRICS countries will act and take advantage of these new participants in this wonderful currency.
    We need to reign in our Debt soon and fast if we are to survive financially but how to do this is NOT by having summits in Jackson Hole among the Rich who will run as soon as it comes home!!!!

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