April 14, 2024

Financials Matter

"It's Not Just About Finance"

BRICS Won’t Replace the Dollar…Yet

Rumblings from the “Peanut Gallery” continue to speculate how the BRICS will replace the dollar.

 

And In Case You Missed it, at the recent BRICS forum in South Africa they announced how the growing pressure for a new global currency comes after continued weaponization of the US dollar in the form of sanctions and trade wars. 

 

(Cough! Ukraine, Cough! Cough!)

 

As a result, many countries are seeking greater independence from the US financial system.

 

Understandably so.

 

But…and this is a very VERY Big Butt…

 

A new global World Reserve Currency is not yet ready for Prime Time.

 

And it’s mostly because there is no other nation that comes close to the size of our bond market which helps facilitate the exchange of ‘dollars.’

However, China is rapidly moving in that direction by issuing Billions in new bonds.

And the fact that Saudi Arabia signed a military cooperation agreement with Russia (in 2021) – making the US no longer the sole protector of the Saudi Kingdom – increases the chances of de-dollarization.

 

 

Replacing the Dollar

 

 

For decades, the United States has been considered the global hegemon.

However, BRICS nations now account for more than 40 per cent of the world’s population

And have an aggregated global GDP of 31.5 per cent.

 

This surpasses the G7’s (United States, Canada, France, Germany, Italy, Japan, and the United Kingdom) GDP of 30.7 per cent.

 

So, it’s conceivable to see BRICS nations entirely self-sufficient, trading among themselves without any reliance on the US.

 

But not yet.

 

Meanwhile, we see a declining share of US dollars held by central banks, according to the IMF Currency Composition of Official Foreign Exchange Reserves (COFER).

 

As a result, countries are positioning themselves for a new international system.

 

And as the reliance on US dollars diminishes, central banks will begin dumping their dollar reserves.

 

Meanwhile, the Gold Bugs continue to claim we will return to a gold standard.

 

But that is not likely to happen.

 

Instead, the chances of having gold as part of a New World Reserve Currency is more likely than not.

 

And we believe the dollar will not be de-throned until after it rises to unimaginable heights…destroying everything in its path.

 

READ“Death of the Dollar…Not Yet” July 8, 2023 (HERE)

 

“The Dollar is Not Dead”  May 16, 2018

“Dollar Surge Returns…With a Vengeance”  October 4, 2022

 

So, if you continue to bet against the dollar…and lose your shirt in the process…don’t say we didn’t warn you.

And if you want to learn how to capitalize on the dollar movements in the next few years, then read the September issue of “…In Plain English” (HERE).

 

Share this with a friend…especially if they think Gold will replace the dollar.

 

They’ll thank YOU later.

 

And tell them:

 

We’re Not Just About Finance

But we use finance to give you hope.

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Invest with confidence.
Sincerely,
James Vincent
The Reverend of Finance
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