A Summary Brief Primer of Critically Important Factors to be aware of relating to the Ukr/Rus Conflict for the Britannic-Rightwing Intelligencia — Currency Wars, DeDollarisation, Civilisational Multipolarity, Sorosification of Politics & Eastern Bloc [Terra Visegrad] Geopolitics
Former US grand strategist Zbignew Brzezinski said: “It is IMPERATIVE that no Eurasian challenger emerges capable of dominating Eurasia and thus of also challenging America”. Because the US has just 4% of world’s population, and it’s isolated from Eurasia which has 70% of world’s population, or 87% with Africa included. Defensively, it’s an advantage to the US, but economically, it’s a handicap. That’s why, Eurasia is a competitor to the US and the Euro is a threat to the dollar.
How the US with an isolated 4% of world’s population stays a world hegemon? The dollar must stay as the world’s reserve currency. This allows the size of the US economy to be highly scaled up, instead of being limited by the fundamentals.
To be the world’s reserve currency, the dollar must circulate in the world. The US created a huge consumption economy and moved manufacturing outside, so that dollars flow out of the US to manufacturers like China or Japan. To make products, China and Japan need energy. So dollar is then circulated to Saudi mandated by the Petrol-dollar scheme. With the US stock and financial market much more lucrative than others, the dollars from Saudi are attracted back to the US. Money printed in the US to exchange for goods from outside ends up in Wall Streets, where the rich gets richer. And that completes the cycle of circulation of the dollar.
If China or Japan brings back all the dollars and exchange to their local currencies, it inflates the local currencies, making their exports expensive. So, China and Japan use some of the dollars to buy US debts (treasury bonds). That’s why the US, a rich country, is in-debt to China which has just 1/5th of the US’ GDP/cap. By holding US treasury bonds, China and Japan have to prevent a dollar collapse.
Since the US’ debt is in its own currency, it can simply print more dollar to pay interests. Other countries have to earn dollars to pay their debts, failing which results in bankruptcy.
In 2011 Obama announced “Pivot to Asia” to stop China’s rise. In 2013 China responded with the Belt and Road Initiatives (BRI) and diverted some US debts into BRI projects, to avoid all eggs in one basket. The BRI creates new economies, therefore new trade markets for China.
If Asia and Africa develop, the share of the US’ economy shrinks, then Euro could replace dollar as the world’s reserve currency. Then the US would no longer be able to print money freely without a hyperinflation like in Venezuela. And the size of the US economy has to fall back to the fundamentals, which is a lot smaller than the inflated economy. That’s why no country in Eurasia is allowed to catch up with the US’ economy.
That’s why no country in Eurasia is allowed to catch up with the US’ economy. When Japan was catching up fast on the US in late 80s, it’s knocked down to a 3-decade stagnancy by rising Yen (Plaza Accord). And in the last 30 years, the US created wars and color revolutions in the Middle East, Central Asia and Africa to destabilise Afro-Eurasia, and the World Bank & IMF keep them poor.
As the US prints lots of money, other countries’ dollar reserves shrink. Furthermore, to prevent exports to the US becoming expensive, these countries have to print money too, which devalues the savings of the people and causes inflation. It’s estimated that our savings devalue by 6~9% per year after the abolishment of the gold-backed Bretton Woods system, after which the US prints money based on just the creditability of the dollar.
Free money allows the US to have a big military, and the big military, in return, protects the dollar.
For the record, the US had no mercy on threats to the dollar:
* In 2000 Saddam Hussein said he would sell oil in Euros not Dollars.
>> Saddam was hanged by the US.