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Although the US dollar has shown strength there are concerns about its future:

October 5, 2018

While interest rate differentials will help the U.S. dollar maintain its value in the near term, there is potential for the currency to decline on expectations that growth may have peaked and as monetary stimulus is replaced by more government spending on the back of tax cuts that look likely, in combination, to lead to higher budget deficits. …

And then, finally, there has been really a lot of rhetoric that has put additional pressure on emerging market currencies from the United States administration and from President Trump, whether that be talk of trade wars, additional tariffs, tariffs that have already gone into effect against a number of countries, most importantly China, the world’s second-largest economy, and there are lists prepared to impose tariffs on further goods from China. https://seekingalpha.com/article/4209993-pm-perspectives-u-s-dollar-outlook-dims-2019-deficit-spending-slowing-growth

Jim O’Neill does not approve of the U.S. dollar’s kingpin status in global markets.

Speaking on CNBC’s “Squawk Box Europe,” the man who coined the term BRICs for the emerging economies of Brazil, Russia, India, China and South Africa expressed his continued frustration at the longtime economic convention.

“We live in this very peculiar situation where the role of the dollar in global finance is just idiotically more important than the U.S. economy. So, if a strong economy translates directly into a higher dollar, some of these things just sort of follow like night and day,” he said. …

“The kingpin role of U.S. policy and the dollar in world finance is an issue, and the U.S. economy, over (the last) 30 years, has gone to less than 20 percent of world GDP (gross domestic product) and yet the dollar is seemingly playing this dramatic role,” O’Neill said. …

Indeed, America’s share of world GDP currently sits at 18 percent, down from 30 percent at the end of World War II. China’s share, meanwhile, has quadrupled to 16 percent, and emerging markets constitute 60 percent of global output. …

O’Neill is not the only analyst who seems tired of the dollar. European countries have of late been in discussion with Russia and China, floating the idea of using alternate currencies for oil trading to avoid U.S. secondary sanctions placed on Iran in the wake of Washington’s withdrawal from the Iran nuclear deal. https://www.cnbc.com/2018/10/04/the-dollars-clout-in-global-finance-idiotically-outsized-jim-oneill.html

The dollar still remains the world’s primary reserve currency.

It will remain so for some time. As Jim O’Neill pointed out, the USA is producing a smaller share of the global output–this WILL have an impact on the US dollar–as will the sanctions he mentioned.

Furthermore, we are seeing more and more international shifts away from the USA dollar, though not all will be successful. Notice the following move from Venezuela:

Venezuela has officially launched what its President Nicolas Maduro claims is a first state-backed oil-backed cryptocurrency, El Petro, which analysts and experts see as nothing but a scam and another effort to skirt sanctions and mask the inability to overhaul the ailing domestic economy. …

The official public sale of the Petro—which Venezuela say is backed by oil, natural gas, diamonds, and gold—will begin on November 5, Maduro has said. …

Just a few months after Maduro first announced the idea of the oil-backed Petro, the U.S. prohibited in March U.S. dealings with any digital currency, coin, or token issued by Venezuela. 10/04/18 https://oilprice.com/Energy/Energy-General/Venezuela-Officially-Launched-Its-Oil-Backed-Crypto-Petro.html

Russian leaders have warned against US sanctions in the past as well as recently:

5 October 2018

MOSCOW (Sputnik) – European companies are considering the idea of abandoning the dollar in transactions with Russia, switch to the euro is a natural consequence of the US policy, Russian Finance Minister Anton Siluanov said on Friday.

“This is something that is decided by two sides, so we will now work with our partners. I think they are interested now too. As you know, there were reports about the initiative to create a euro-SWIFT payment system which will be used exclusively among European banks, European financial institutions for trade in oil, oil products and other commodities. I think the Europeans are already thinking about this. We are ready to join such initiatives,” Siluanov told the Rossiya 24 broadcaster, when asked whether it was possible that European companies would use euro in the purchase of Russian oil and gas next year.

The minister noted that such move would become “a response to the restrictions imposed by the United States, including against enterprises and financial institutions that use the dollar in their transactions.” https://sputniknews.com/world/201810051068628583-eu-dollar-russia/

Russian President Vladimir Putin gave a speech on the Russian Energy Week, on Wednesday, saying that his Washington counterparts are making a “typical” and “colossal” mistake, referring to the sanctions imposed to countries around the world which have threatened the dollar dominance.

“It seems to me that our American partners make a colossal strategic mistake,” Putin said, adding that it is a “typical mistake of any empire.” Russia, and other countries, recently have been trying to reduce the use of U.S. dollars in their economies and as a transaction tool.

For President Putin, the U.S. sanctions imposed on different countries worldwide “undermine the credibility of the dollar as a universal and the only reserve currency today.” The sanctions are pushing countries to the de-dollarization of their economies, as Russia has been trying to do since sanctions were imposed.

“People think that nothing will happen, everything is so powerful, everything is so strong and stable, there will be no negative consequences. But, no, they come sooner or later,” Putin said, emphasizing that “they really are taking a saw to the branch they are sitting on.” https://www.telesurtv.net/english/news/Putin-US-Making-Colossal-and-Typical-Empires-Mistake-20181003-0029.html

Vladimir Putin is right. The status of the US dollar as the world’s primary reserve currency is at risk. Russia, China, Turkey, Iran, North Korea, and others want to topple it, and sanctions against them are pressing them more towards working to dethrone the USA dollar.

Now, consider the following related to Iran, Russia, and Europe:

Europe Finally Has an Excuse to Challenge the Dollar

The plan for a “special purpose vehicle” to bypass U.S. sanctions on Iran could test American dominance of the global financial system. …

Federica Mogherini, the European Union’s top foreign-policy official, said in New York on Monday that the plan to create a “special purpose vehicle” for trade with Iran “will mean that EU member states will set up a legal entity to facilitate legitimate financial transactions with Iran, and this will allow European companies to continue trade with Iran.” The technical details are still to be worked out, but her wording provides some useful hints on how the scheme will work. … it is clear to the Europeans (as well as the Chinese and Russians) that any future transactions with Iran must go through entities insulated from the American financial system. In a July 2018 report, Axel Hellman of the European Leadership Network think tank and Esfandyar Batmanghelidj of the business publisher Bourse & Bazaar proposed “a new banking architecture” in response to the U.S. sanctions, relying on the existing system of “gateway banks,” such as the Hamburg-based Europaeisch-Iranische Handelsbank, and the European branches of private Iranian banks. “A further third category of gateway banks can be envisioned,” they wrote, “which would comprise of special purpose vehicles established by European governments, or as part of public-private partnerships in order to facilitate Iran trade and investment.”

The new plan appears to focus on this third option. Mogherini indicated that Germany, France and the U.K. would set up a multinational state-backed financial intermediary that would deal with companies interested in Iran transactions and with Iranian counter-parties. Such transactions, presumably in euros and pounds sterling, would not be transparent to American authorities. European companies dealing with the state-owned intermediary technically might not even be in violation of the U.S. sanctions as currently written. The system would be likely be open to Russia and China as well. https://www.bloomberg.com/view/articles/2018-09-25/europe-finally-has-an-excuse-to-challenge-the-dollar

Could Russia’s plan to shun the dollar boost its economy?

The government is preparing a bill to ‘de-dollarise’ the Russian economy in response to incoming US sanctions.

Drawn up using ideas from VTB bank head Andrei Kostin, the bill could be approved by Prime Minister Dmitry Medvedev in just two weeks.

Kostin himself said President Vladimir Putin “as a whole” endorsed his proposals, which seek to reduce Russian dependence on the US, although details of the draft law are yet to be made clear.

Regardless, government representatives say its goal isn’t to restrict payments in dollars but to encourage foreign trade to be settled in roubles or other currencies. …

Could Kostin’s plan weaken the dollar?

Solodkov: “The dollar could be destabilised if at the same time China, Japan and the EU together decide not to use it for transactions or their reserves. But the probability of this leans towards zero.

“The main issue is that reserve currencies are not chosen at will. There is objective demand, both for payments and savings in these currencies. Unfortunately, none of the currencies with which the Russian Federation intends to pay, with the exception of the euro, is a currency that everyone would like to have.”

Professor Abramov: “If Russia succeeds in convincing European Union countries, as our main consumers, to make oil payments in euros rather than dollars, this would be a real, tangible blow to the dollar.

But imagine stepping into the shoes of a European partner: to what extent would this be a long-term solution? Why would they want to force a confrontation between Europe and the United States?” https://www.euronews.com/2018/10/04/could-russia-s-plan-to-shun-the-dollar-boost-its-economy

Note the question: “Why would they want to force a confrontation between Europe and the United States?”

Well, because Europe wants to rule the world and it more and more sees that the USA is in its way.

The probability of China, Japan and the Europeans dropping major use of the USA dollar is NOT zero,

It will happen, though it will take some time.

This basically could happen with a combination of multi-national cooperation (of which we are seeing more of against the USA dollar), natural and/or man-made disasters impacting the USA, and increasing USA debt (which keeps happening).

The USA ‘benefits’ in many ways by having the world’s predominant reserve currency.

Notice also a recent video on our Bible News Prophecy YouTube channel:

15:19

Here is a link to our video: US Sanctions and Tariffs leading to New World Order?

US sanctions and trade policies are factors that will lead to the loss of the USA dollar as the world’s premier reserve currency.

As I warned prior to Donald Trump’s inauguration, there will be many “unintended consequences” to some of his policies and statements.

The days of the US dollar’s dominance are numbered. US sanctions and tariffs are helping lead to its demise.

There is a cost to USA sanctions.

They are pushing the Gentile nations to come up with something that the USA will not like.

One day the USA dollar will be worth no more than the scrap value of the cotton-paper it is printed on.

It will be worse than CNBC seems to think even though it reported the view that the US dollar is currently losing strength.

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This entry was posted on Friday, October 5th, 2018 at 6:30 am and is filed under Prophecy.

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