ZH: Euro Challenges USDollar As Global Currency
(Pixabay photo)
Will the Euro surpass the US dollar as the world’s primary reserve currency?
Some suspect it might:
Euro Challenges USDollar As Global Currency
January 15, 2022
Goldman Sachs this week predicted that the Eurozone would grow at a faster pace than the U.S. in 2022, projecting a growth rate of 4.4 percent for EU and only 3.5 percent for U.S. GDP. The latest World Bank forecast, also from January, still sees the U.S. ahead, if only by a paper-thin margin of 0.1 percent, while the new IMF outlook is yet to be released.
While the jury is still out on who will trump who for economic growth this year, Statista’s Katharina Buchholz notes that there are other indicators that already show the Eurozone’s growing economic prowess and international importance. The value of global payment transactions in Euro has been inching up to that of the U.S. dollar, data from the Swift international payment network shows, hinting at increased activity around the currency. In October 2020, Euro transaction value even slid ahead of the U.S. dollar, and while that didn’t last long, the gap between the two currencies on the world stage has become considerable smaller since the start of the coronavirus pandemic. Potential reasons for this include the EU’s coordinated efforts to prop up its economy in the current crisis and its continued zero-interest fiscal policy. Faith in the U.S. economy and its growth is meanwhile shaky, according to CNBC, as uncertainty around President Joe Biden’s “Built Back Better” economic package continues. https://www.zerohedge.com/geopolitical/euro-challenges-usdollar-global-currency
When I did a search for “reserve currency’ pictures in Pixabay today, on its first page, ALL of the pictures were of either US dollars or Euros, with the photo at the beginning of this post showing both.
Proportionally, the world still primarily uses the US dollar as its primary reserve currency.
But, because of US sanctions, increasing US debt and money supply increases, and the general strength of the European economy, more are looking towards the Euro as the US dollar replacement.
Here is an article from last May by where Dennis Miller and Chuck Butler discuss the US dollar potentially losing its reserve currency status
“Asia and Russia have a problem with the USD being the global reserve currency. …. We believe that this ongoing depreciation of the USD will continue….” …
DENNIS: … What are the perks of the country with the world reserve currency?
How does a country benefit from world reserve currency status?
What happens when they lose their esteemed status?
What should we expect?
CHUCK: Well, let’s start with the perks…
The reserve currency is held in significant quantities by central banks/ monetary authorities as part of their foreign exchange reserves. Worldwide demand for dollars has allowed the United States government to borrow at lower costs.
The reserve currency is used in international transactions, investments and all aspects of the global economy.
The U.S. has an advantage when it comes to commodity prices since all are priced in dollars.
Also, so far at least, the reserve status allows the U.S. to print as much debt as the world can swallow, at very cheap levels.
When a country loses reserve currency status, those perks go away as the world no longer needs, or demands their currency to facilitate international trade.
DENNIS: When the world is awash with an unwanted currency, the value depreciates, and they experience high inflation. …
How do you see that playing out?
CHUCK: Hold on tight, here we go down the rabbit hole…
So, losing the advantages I outlined would bring about quite a few changes in our economy, our value of the dollar, which affects your buying power, and life as we know it…
Any future weak dollar trend could easily trigger the loss of the reserve currency status, affecting everyone:
- A sudden dollar collapse would create global economic turmoil.
- Investors would rush to other currencies.
- Investors would rush to other assets, such as gold and commodities.
- Demand for Treasuries would plummet.
- Interest rates would rise, and possibly very high.
- U.S. import prices would skyrocket, causing inflation.
- The cost of commodities like Oil would increase.
As an example, I used to compare gas prices. In the U.K., gas costs $8 a gallon as compared to the U.S. being $3. We would all pay what everyone else in the world pays for gas.
Remember when the Beatles appeared on Ed Sullivan in 1963? They showed pictures of their home town, Liverpool, England. Those pictures are as depressing now, as they were then.
The U.K. lost the reserve currency status after World War II; 20 years later they still hadn’t recovered, economically, and psychologically.
The U.S. would probably have to default on some debts; causing a major shift around the world out of dollars, and stocks. I’d expect damage to your investments, psyche and your buying power.
All those reserves that foreign Central Banks hold in dollars, would be sold back to the U.S. or given back in trade, and no new reserves purchased.
U.S. Treasuries will be ignored at the auction window by foreign countries…
Why would that be a problem? Today our government spends trillions more than they take in with taxes; financing the shortfall through borrowing. To borrow a line from Blanche DuBois; when the kindness of strangers disappears, how will the debt be financed?
To borrow money the government would have to allow Treasury yields to rise to the point where there is enough risk premium to entice foreigners to buy them. That will have a negative effect on business and the market.
Countries that experienced hyperinflation all experienced some level of civil disorder, riots, and calls for more money from a bankrupt government. 5/14/21 https://www.investorsalley.com/what-happens-to-retirees-when-the-u-s-dollar-is-no-longer-the-reserve-currency-article-miller/
What will happen to the USA when its dollar loses its primary reserve currency status will be MUCH WORSE than what happened in the UK.
Why?
The UK was not as indebted nor dependent upon debt as the USA is.
The USA has been gambling with its currency for many years.
Its leaders basically think that they can continue to get away with it.
But one day they will not (cf. Habakkuk 2:6-8).
What about Europe?
Now, it is true that Europe is reeling from COVID-19, Brexit, and other issues.
Yet Europe has NOT produced as many trillions of Euros of debt, at least not yet, for COVID-19, that the USA has with its dollar. Plus, several of the nations there have been accumulating and/or repatriating gold.
Understand that the Bible shows that the time will come when Europe will prosper mightily and be involved with gold (cf. Revelation 18).
Now, consider a story, I have reported here before:
There once was a movie that had two men camping outdoors. Suddenly, one man yells, “Run, a bear!” The other man yells back, “You can’t outrun a bear.” The first man responded with, “True, but all I have to do is to outrun you.”
The implication is that the first man only needed to be better runner than the second man, which presumably the bear would consider to be weaker, and then catch and destroy. This would, supposedly, allow the first man to survive.
From an economic perspective, the story basically is that the debt and economic situation in Europe does not need to be perfect, only perceived to better (or at least similar) than that of the USA to someday surpass it.
While the Bible shows that gold and silver will one day be considered worse than useless (cf. Ezekiel 7: 19), it also shows that it will have value after the USA is defeated (cf. Daniel 11:39-43).
That being said, yes the USA dollar will collapse one day–and some type of European back currency, possibly the Euro or perhaps some type of international basket of currencies will replace the US dollar as the world’s reserve currency.
Notice the following assessment from the past:
“Unless the US stops printing money, the dollar will collapse.”
October 27, 2020
There seems to be a wide rift in US politics, which is not just pragmatic or ideological, but perceptual too: The two “camps” and their supporters appear to be living in and arguing about two different versions of reality, and neither corresponds to the actual experiences of most ordinary citizens, taxpayers and savers. This disconcerting dissonance became painfully apparent in the first Presidential debate, at least to those who had the patience to keep watching after the first few minutes. It was especially pronounced when the candidates were asked about their economic policies and recovery plans. Both had all these grand plans, big-spending dreams and voter-pleasing promises, and for those of us who understand even the very basic lessons from our monetary history, one thing was clear as day: If there’s one thing the two sides can agree on, it’s that fiscal prudence, responsibility and long-term thinking, are at the bottom of their priority list. …
Claudio Grass (CG): For any student of monetary history, the past decade was a fascinating period. Many of us expected this reckless experiment with QE, negative rates and aggressive expansionism by central bankers to end in tears, but few could have foreseen the response to the Covid crisis. Do you expect this move to “double down” on bad policies to expedite the monetary system’s demise or perhaps to breathe new life into it and simply prolong it?
Patrick Barron (PB): An old grad school professor of mine always reminded us that all analogies distort, yet I will give an analogy just the same. Printing money is analogous to taking some stimulant such as cocaine. Taking cocaine and printing money out of thin air don’t really improve one’s health or the economy, and the user and the economy may improve due to other factors. But over time, one needs to take bigger and bigger doses in order to achieve the same effect. If the drug user continues, at some point the drug will kill him. How much cocaine is too much? No one knows.
Undoubtedly the dosage differs with the individual–the stronger being able to take larger doses over a longer period of time than the weaker. The US is stronger than Zimbabwe, for example. This means that the US can print more money over a longer period of time. But it does not mean that the US can print money forever and in ever increasing quantities and always experience the same artificial high. No one really knows when the dollar will collapse. But, we do know that unless the US stops printing money, the dollar WILL collapse. The response to the Covid crisis has undoubtedly hastened that day. https://claudiograss.ch/2020/10/unless-the-us-stops-printing-money-the-dollar-will-collapse/
Yes the responses of many federal and state governments in the US, that are blamed on COVID-19, are hastening the day that the US dollar will collapse. As far as gold and silver goes, there will be issues with them, but they will have value for a time after the US dollar collapses (see also The Plain Truth About Gold in Prophecy. How Should a Christian View Gold?).
The US dollar will one day be worth no more than its scrap or burning value, other than perhaps as a collector’s novelty.
As far as gold as a partial replacement for the US dollar, the Continuing Church of God (CCOG) put out the following video on our Bible News Prophecy YouTube channel:
China introduced something that was called the gold-petro-yuan back in 2018. Since then, the global share of US-dollar-dominated exchange reserves have dropped to 59.0%. In April 2021, China became the first major economy to unleash a Central Bank Digital Currency. China also has given its banks permission to import large amounts of gold. Is China preparing for a gold-backed yuan to push aside the US dollar or to help it survive a US dollar cataclysm? Are other nations preparing to push the US dollar aside? Do Europeans seem to have the most gold? Are Europeans prophesied to gain more gold? Is the US debt trajectory sustainable per Fed Chairman Jerome Powell? Does the Bible warn of the end coming to the highly indebted in Habakkuk 2:6-8? Why does it looked like a gold-backed currency will replace the US dollar? Will the US dollar, ultimately, become essentially worthless? Dr Thiel addresses these issues and more.
Here is a link to our video: Gold Backed Currency to Replace the US Dollar?
The US dollar will collapse a few years before the end of that 6,000 years and Jesus returns.
This would suggest prior to 2028 (watch Is the US prophesied to be Destroyed by 2028).
A collapse of US dollar is coming.
Neither its elected political leaders or its Federal Reserve will not stop that.
There will be a new totalitarian world order coming (cf. Revelation 13) and it will not be one dominated by the Anglo-Americans.
If you think that the USA and its dollar will continue to be number 1 and claim to believe the Bible, please consider biblical prophecies such as Daniel 11:39; Habakkuk 2:6-8; Isaiah 10:5-11 (see also USA in Prophecy: The Strongest Fortresses and/or watch Do these 7 prophesies point to the end of the USA?).
Hopefully, you are taking the proper spiritual steps now, whether or not you might be American.
Some items of possibly related interest may include:
The End of US Dollar Dominance Is the USA losing its economic status? What about the petro-gold-yuan? A related video is also available: US Dollar being challenged by Gold-Petro-Yuan.
The Plain Truth About Gold in Prophecy. How Should a Christian View Gold? What do economists and the Bible teach about gold? Gold and silv
Is God Calling You? This booklet discusses topics including calling, election, and selection. If God is calling you, how will you respond? Here is are links to related sermons: Christian Election: Is God Calling YOU? and Predestination and Your Selection. A short animation is also available: Is God Calling You?
Christian Repentance Do you know what repentance is? Is it really necessary for salvation? Two related sermons about this are also available: Real Repentance and Real Christian Repentance.
USA in Prophecy: The Strongest Fortresses Can you point to scriptures, like Daniel 11:39, that point to the USA in the 21st century? This article does. Two related sermon are available: Identifying the USA and its Destruction in Prophecy and Do these 7 prophesies point to the end of the USA?
Who is the King of the West? Why is there no Final End-Time King of the West in Bible Prophecy? Is the United States the King of the West? Here is a version in the Spanish language: ¿Quién es el Rey del Occidente? ¿Por qué no hay un Rey del Occidente en la profecía del tiempo del fin? A related sermon is also available: The Bible, the USA, and the King of the West.
Does God Have a 6,000 Year Plan? What Year Does the 6,000 Years End? Was a 6000 year time allowed for humans to rule followed by a literal thousand year reign of Christ on Earth taught by the early Christians? Does God have 7,000 year plan? What year may the six thousand years of human rule end? When will Jesus return? 2029 or or 2031 or 20xx? There is also a video titled 6000 Years: When will God’s Kingdom Come? Here is a link to the article in Spanish: ¿Tiene Dios un plan de 6,000 años?
Might the U.S.A. Be Gone by 2028? Could the USA be gone by the end of 2028 or earlier? There is a tradition attributed to the Hebrew prophet Elijah that humanity had 6,000 years to live before being replaced by God’s Kingdom. There are scriptures, writings in the Talmud, early Christian teachings that support this. Also, even certain Hindu writings support it. Here is a link to a related video: Is the USA prophesied to be destroyed by 2028? In Spanish: Seran los Estados Unidos Destruidos en el 2028?
The Great Tribulation: What Happens First? What events have happened? What are some events that are now happening? And what events need to happen for the Great Tribulation to start? Here is a link to a related sermon video: Counting Down to the Great Tribulation. Here is a video in the Spanish language: Contando los eventos y el inicio de la Gran Tribulación.
When Will the Great Tribulation Begin? 2022, 2023, or 2024? Can the Great Tribulation begin today? What happens before the Great Tribulation in the “beginning of sorrows”? What happens in the Great Tribulation and the Day of the Lord? Is this the time of the Gentiles? When is the earliest that the Great Tribulation can begin? What is the Day of the Lord? Who are the 144,000? Here is a version of the article in the Spanish language: ¿Puede la Gran Tribulación comenzar en el 2020 o 2021? ¿Es el Tiempo de los Gentiles? A related video is: Great Tribulation: 2026 or 2027? A shorter video is: Can the Great Tribulation start in 2022 or 2023? Here is a video in the Spanish language: Es El 2021 el año de La Gran Tribulación o el Grande Reseteo Financiero.
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