The Collapse of the Dollar?
Dominoes begin to fall.
Back in the very first Unprepared post from Feburary of last year, I predicted that if Russia invaded Ukraine, it would be cut off from SWIFT (happened), would lead a global shift from the dollar (happening), and Bitcoin would become the new de facto exchange currency (not happening):
One thing to keep an eye on: Putin’s recent interest in Bitcoin, directly contradicting Russia’s own central bank that wants to ban it. Russia has now agreed to treat crypto as currency.
Putin has a good reason to be interested: although it’s currently off the table, Biden has flirted with banning Russia from the SWIFT international payment system, which is used in over 200 countries. European banks are convinced it’s still a distinct possibility.
If that happens, Bitcoin would give Russia a workaround to trade with its partners, and the United States and its allies would be hard-pressed to stop it. Currently, the US Dollar is the world’s de facto exchange currency, but Russia officially adopting Bitcoin could be a tipping point to establishing Bitcoin as the new reserve currency, upending the global financial order.
Oh well. Two out of three ain’t bad. However, what’s undeniable is that the US dollar is losing power. Since the end of the Bretton-Woods system in 1971, the dollar has been the currency for oil, thus making it the de facto world currency, and powering the American empire. But recent moves from China threaten that.
The recent meeting between Russia’s Vladimir Putin and China’s Xi Jinping has been downplayed and mocked, but several interesting developments have transpired recently:
Saudi Arabia signed a deal to build oil refineries in China, and is considering accepting the Yuan for oil payments.
And this is after the Chinese brokered a peace deal between Saudi Arabia and Iran.
Now Malaysia and China are discussing an Asian Monetary Fund to further erode the dollar’s influence.
These are seismic shifts that even CNN can’t deny.
If you think the United States will take this lying down, guess again. General Milley has already been playing up the possibility of a two-front war against China and Russia. “But war with either is neither inevitable nor imminent,” he recently told Congress. He also said that China, Iran, and Russia would be a problem for “many years to come.”
The question is: would the US and its allies even be able to fight a war? Both the United States and Great Britain are low on munitions after sending so many to Ukraine.