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The Washington Post reported the following:

Why the enormous scale of financial pain being inflicted on Russia worries some in the West

March 3, 2022

Russia is under unprecedented economic pressure after invading Ukraine. Many in the West feel vindicated, even happy that the financial might of the United States, Europe and other allies is being fully used against Russian President Vladimir Putin and his allies after years of half measures and looking the other way.

But some experts and analysts aren’t feeling triumphant. Instead, they’re worried. Worried that these sanctions will have collateral damage in Russia and beyond, potentially even hurting the very countries that impose them. Some even worried that the sanctions intended to deter and weaken Putin could end up emboldening and strengthening him. …

The number of U.S. sanctions designations has grown substantially year on year since 2000. …

These sanctions could end up hurting the West, too. …

Artyom Lukin, a professor at the Far Eastern Federal University in Vladivostok, Russia, said …“Perhaps the only thing that is certain to me is that in the wake of the sanctions Russia’s geoeconomic dependence on China will grow substantially,” https://www.washingtonpost.com/world/2022/03/03/sanctions-worries-russia-west-scale/

Just like most roads go two ways, sanctions have affects on those who impose them and those they are imposed upon.

ZeroHedge posted the following:

Zoltan Pozsar Warns Russian Sanctions Threaten Dollar’s Reserve Status

March 3, 2022

Over the weekend, the world gasped in shock when Western powers announced that the nuclear option would be used against Russia in retaliation for its invasion of Ukraine – sanctions against the country’s central bank and targeted expulsions of key banks from SWIFT, a move which has effectively locked Russia out of the western financial system and left its vast oil export industry – a key lifeline for the Putin regime – in limbo. But the real reason for the shock is that this was the first time the global reserve currency was weaponized against a G20 economy …

Reuters’ Mike Dolan wrote that the move quickly prompted questions about whether targeting reserve holdings as an act of “economic warfare” may prompt a rethink by reserve managers across the globe – not least in countries that may be at loggerheads or face a potential conflict with U.S. or EU governments – over where to bank their national stash.

It’s a potentially huge issue for world markets given that central bank foreign currency reserves totaled a record $12.83 trillion late last year – a rise of $11 trillion over the past 20 years. This money is held mostly in U.S. and European government bills and bonds – with the U.S. dollar still accounting for almost 60% of that and the euro about 20%. …

China itself – for all its fraught relationship with the West – has been the biggest reserve stockpiler since it joined the global trading system 20 years ago amid tight control of its exchange rate. More than $3 trillion of its $3.22 trillion hoard was amassed since 2000 – precisely to offset foreign inflows to keep a lid on the yuan.

But is that about to change, and did western sanctions against Russia marked the beginning of the end of the dollar as the world’s reserve currency?

Berkeley professor and expert on world reserve management Barry Eichengreen reckons that of the two imperatives behind reserve stockpiling – to intervene or stabilize domestic markets or as a war chest against shocks, disasters or balance of payments crises – the latter may now be in question. “The main effect may be declining demand for reserves,” he said. …

But the most surprising take comes from former NY Fed staffer, current repo guru and Credit Suisse money market guru Zoltan Pozsar – who on any other day would be a stalwart advocate of the status quo – and who ominously said that the response to Russia may have set off a sequence of events in motion that eventually leads to the demise of the dollar as the reserve currency.

Speaking to Bloomberg, Pozsar – who this weekend warned that the lockout of Russia from the global financial system could prompt central banks to aggressively pump liquidity to stabilize markets – said noted that wars tend to turn into major junctures for global currencies, and with Russia losing access to its foreign currency reserves, a message has been sent to all countries that they can’t count on these money stashes to actually be theirs in the event of tension. …

Of course, none of this is a surprise to Russia, which has been feverishly rotating out of its “inside money” dollar reserves, including dumping off all of its U.S. Treasuries in 2018 according to official data, and amassing a record stockpile of gold in the process. In fact, as Pozsar noted over the weekend, “the Bank of Russia now has more gold than deposits at foreign central banks!” https://www.zerohedge.com/markets/zoltan-pozsar-warns-russian-sanctions-threaten-dollars-reserve-status

Russia has long seen problems with the USA dollar and its dealings with the USA. While it is being harmed by USA sanctions, it took steps–including looking at gold.

Notice also:

Could Economic Warfare Backfire on the US?

Economic sanctions serve as a powerful foreign policy tool for the US government. But could this ultimately backfire on the US?

Over the last several years, many countries have made a concerted effort to limit dependence on the US dollar. The economic warfare waged against Russia reveals exactly why. …

The US is a global superpower and maintains an aggressive foreign policy. But the US doesn’t only project power across the globe through its massive military. It also weaponizes the US dollar, using its economic dominance and its privilege as the issuer of the global reserve currency in a carrot-stick tool of foreign policy.

The US government showers billions of dollars in foreign aid to “friends.” On the other hand, “enemies” can find themselves locked out of SWIFT, the global financial system that the US effectively controls using the dollar. …

Since the dollar serves as the world reserve currency, SWIFT facilitates the international dollar system. …

If enough countries abandon the dollar, the value of the US currency would collapse and create economic chaos here at home. The de-dollarization of the world economy would likely perpetuate a currency crisis in the United States. Practically speaking, it would likely lead to hyperinflation.  03/01/22 https://schiffgold.com/commentaries/could-economic-warfare-backfire-on-the-us/

Other nations are looking at what is happening to Russia and also will take steps.

Steps that will tend to reduce their dependency on USA dollars. And some will look to gold.

Yes, the USA is harming its position as economic leader of the world by what it is now doing.

The USA will be harmed by its sanctions.

Now the Europeans will be hurt as well. But, consider that they also want to topple the USA dollar as the world’s primary reserve currency. That is actually one of the reasons for the Euro–which is now a reserve currency, but at a distant second to the USA dollar.

Notice also two headlines from 2018:

Germany urges SWIFT end to US payments dominance

08/27/18 https://www.dw.com/en/germany-urges-swift-end-to-us-payments-dominance/a-45242528

EU Looking to Sidestep U.S. Sanctions With Payments System Plan

https://www.bloomberg.com/news/articles/2018-08-27/eu-looking-to-sidestep-u-s-sanctions-with-payments-system-plan

The Europeans now have something in place called Instex (see EU announces a modified Instex: The Swift end of US dollar dominance).

And although the Europeans are CURRENTLY with the USA on sanctions against Russia, they will one day turn against the USA (cf. Isaiah 10:5-11; Daniel 11;39).

European support to push many Russian banks off from SWIFT also reduces the power of the USA dollar.

There are many unintended consequences of sanctions.

The reality is the USA dollar will one day be totally worthless.

Furthermore, as inflation rises, it is already worth, depending upon how you calculate it, between 8-20% less than it was worth last year.

And the affect of sanctions on Russia look to contribute to more inflation. Notice, also, the following:

Sanctions Are Going To Devastate Russia Economically, But They Are Going To Devastate Us Economically Too

The economic sanctions that have been imposed on Russia by western powers are really going to hurt. But they aren’t just going to hurt the Russians. The measures that are now being implemented are going to be quite a shock for the entire global economic system, and all of us will be affected. Energy prices will be going much higher, food prices will be going much higher, and the sanctions are going to cause chaos in the financial world for months to come. Of course things were already starting to get really crazy even before the war began, but now our problems are really going to start to accelerate.  …

Western financial institutions are holding lots of Russian debt.  Now that the Russian government, Russian banks and Russian corporations are being sanctioned, they could very easily decide to fight back by not repaying those debts.

Needless to say, that could cause some rather immense problems.

Meanwhile, energy prices are going to escalate to absolutely frightening levels.  At one point on Tuesday, West Texas Intermediate crude futures were selling for $106.78 per barrel, but that could be a bargain price compared to what is coming.

Because even though the U.S. and western powers explicitly avoided including Russian energy in their sanctions, many in the energy industry are choosing to boycott Russia anyway…

Of course a much higher price for oil will be felt throughout our economy in thousands of different ways.

For example, just about everything that we buy has to be transported, and transporting goods takes energy.

Inflation has already started to spiral out of control in the United States, and it appears that the worst is definitely still to come. …

The price of food is going to be rising aggressively as well. 03/01/22 http://endoftheamericandream.com/sanctions-are-going-to-devastate-russia-economically-but-they-are-going-to-devastate-us-economically-too/

Here is an opinion about what happens if the USA dollar collapses:

What happens to the American people when the dollar collapses?

When the dollar collapses, America will be plunged into lawlessness, chaos and destitution. Most commercial transactions will simply cease to function, causing a near-immediate halt to deliveries of everything (food, fuel, replacement parts, vehicles, tractors, etc.).

You don’t have to be a genius to figure out that America’s cities will burn while gun battles rage in the streets … https://www.naturalnews.com/2022-03-02-the-economic-suicide-of-the-west-is-now-under-way.html

Let me simply add that the above opinion is optimistic. It may start out that bad, but will get worse.

So much so, that it will lead to the end of the USA per Habakkuk 2:6-8.

For years, I have warned about risks associated with USA sanctions.

We even put out the following video:

So, yes, both the Trump and Biden Administrations have been inclined to impose sanctions. This is leading many nations to try to get around them and USA influence.

Furthermore, China also has been trying to come up with systems, including with gold backing, to avoid the US dollar (watch US Dollar being challenged by Gold-Petro-Yuan).

The USA has been pushing countries away from its currency.

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

The Russians have called US actions hypocritical.

The Bible tells of destruction coming to “an hypocritical nation” (Isaiah 10:6, KJV).

The USA does not seem to realize that it is undermining its position as the world’s primary reserve currency through its sanctions and other policies.

This is an unintended consequence of US sanctions policies.

The Bible points to the end coming to the USA (cf. Daniel 11:39) and economic mishandling will be a factor (cf. Habakkuk 2:6-8).

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This entry was posted on Thursday, March 3rd, 2022 at 7:00 am and is filed under Prophecy.

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