By "Punishing" France, The US Just Accelerated The Demise Of The Dollar

Tyler Durden's picture

Not even we anticipated this particular "unintended consequence" as a result of the US multi-billion dollar fine on BNP (which France took very much to heart). Moments ago, in a lengthy interview given to French magazine Investir, none other than the governor of the French National Bank Christian Noyer and member of the ECB's governing board, said this stunner at the very end, via Bloomberg:


Here is the full google translated segment:

Q. Doesn't the role of the dollar as an international currency create systemic risk?


Noyer: Beyond [the BNP] case, increased legal risks from the application of U.S. rules to all dollar transactions around the world will encourage a diversification from the dollar. BNP Paribas was the occasion for many observers to remember that there has been a number of sanctions and that there would certainly be others in the future. A movement to diversify the currencies used in international trade is inevitable. Trade between Europe and China does not need to use the dollar and may be read and fully paid in euros or renminbi. Walking towards a multipolar world is the natural monetary policy, since there are several major economic and monetary powerful ensembles. China has decided to develop the renminbi as a settlement currency. The Bank of France was behind the popular ECB-PBOC swap and we have just concluded a memorandum on the creation of a system of offshore renminbi clearing in Paris. We have very strong cooperation with the PBOC in this field. But these changes take time. We must not forget that it took decades after the United States became the world's largest economy for the dollar to replace the British pound as the first international currency. But the phenomenon of U.S. rules expanding to all USD-denominated transactions around the world can have an accelerating effect.

In other words, the head of the French central bank, and ECB member, Christian Noyer, just issued a direct threat to the world's reserve currency (for now), the US Dollar.

Putting this whole episode in context: in an attempt to punish France for proceeding with the delivery of the Mistral amphibious warship to Russia, the US "punishes" BNP with a failed attempt at blackmail (recall that as Putin revealed, the BNP penalty was a used as a carrot to disincenticize France from concluding the Mistral transaction: had Hollande scrapped the deal, BNP would likely be slammed with a far lower fine, if any). Said blackmail attempt backfires horribly when as a result, the head of the French central bank makes it clear that not only is the US Dollar's reserve currency status not sacrosanct, but "the world" will now actively seek to avoid USD-transactions in order to escape the tentacle of global "pax Americana."

And, the biggest irony of all is that in "punishing" France for dealing with Russia, that core country of the Eurasian alliance of Russia and China, the US merely accelerated the gravitation of France (and all of Europe) precisely toward Eurasia, toward a multi-polar (sorry fanatic believers in a one world SDR-based currency) and away from the greenback.

Or shown visually (as we have ever since 20120).

Meanwhile, somewhere Putin is still laughing.

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Bruno de Landevoisin's picture

Put your USA USA USA pompoms down, no one buys your self serving horsehit anymore.  Go print some more paper $$$ to impress us all.

McMolotov's picture

The US is a pompous, hypocritical, pathetic shell of its former self. All we have left are the tattered pompoms we've been waving since WWII.

There's a reason I joke that I tell people I'm Canadian. Not sure how much longer it'll remain a joke...

Aussiekiwi's picture

Individually Americans are great people, never met one I didn't like, (may be I'm just lucky), its as group that the stupidity level rises, perhaps that applies to all groups.

Anusocracy's picture

I can certainly say that about Australians - saved my life twice.

But then again, I've never met any of your politicians.

falak pema's picture

...Sleazy European banks salivated over a chance to make a quick buck circumventing sanctions, and they got caught, and they have been getting punished....

Lol, 'cos other banks can be sleazier than the US cabal?

You've reinvented the "sleaze" spectrometer of the TBTF brigade.

You deserve a Nobel just for that!  

You do know that the US sanctions are totally UNILATERAL in nature and are NOT EVEN US Law but US Admin banking decrees, which they make up knowing that the US clearing houses are in a MONOPOLY position and that foreign TBTF banks HAVE to deal with the US clearing house on US soil for their $  transactions to survive in international banking world. 

The whole USD monopoly is the biggest scam of them all and its a total protectionist racket just based on ONE Admin Mantra dating 1971 : Our money your problem. 

Talk about "invisible hand of markets" and clean dealings and foreign banking "sleaze".

The whole Oligarchy world is just one ocean of sleaze. 

And there is NO BIGGER protectionist racket than the FED's greenback with the possible exception of the US/SAUD oil monopoly created by the Seven Sisters and Aramco. 

Bruno de Landevoisin's picture

Very well stated............bravo.

Ghordius's picture

great rebuke, falak. applause

Lux Fiat's picture

While you present some interesting food for thought, I tend to agree with Falak Pema on this one.  US regulators and prosecutors seem to have no qualms body slamming foreign banks, while criminally fraudulent and economically damaging activity perpetrated by US-based banks was swept under the rug, and stays there, with the one off low-level sacrificial lamb trotted out from time to time. 

The wake up call for me was not the '08/'09 implosion, but what happened, or in this case, didn't happen, in it's aftermath.  Toto, we're not in Kansas anymore.

August's picture

>>>The Manhattan prosectutors began this investigation in January 2006 under Robert Morgenthau, who was succeeded by Cyrus Vance Jr.. 

Only because Clark Clifford is still dead.


Grumbleduke's picture

Now looky here:

Who's boss of the FBI, the mighty FBI?

James Comey

This sack of shit was on the board of directors of HSBC Holdings

Formerly know for laundering drug cartel money (and saving muricas banks), now running the enforcers.


This is so exceptional!

andrewp111's picture

There is no inconsistency in the narratives Just because the fines were over trade with Iran doesn't mean the Obama Administration didn't try to use them as leverage in scuttling the Mistral sale to Russia. In foreign policy, all things are interconnected.

Seize Mars's picture

Look, at this point, if you don't know:

1 - Fiat money is a very unrealiable place to store your hard work

2 - The USD is not going to last

3 - The demise of the American Republic and the USD are both by design

...then I don't know what to say.

BeetleBailey's picture

I'd like to read one lucid comment on what will replace the USD as the reserve currency.

Everyone yammering about the demise of the USD....fine....agreed.

But...what will replace it?

The Yuan? I highly doubt it.

The Rubel? see above....

A "basket of currencies"?

The Euro? Again...highly dubious....

El Vaquero's picture

Why must something replace it? 

Ghordius's picture

I disagree. roughly. there is the American Republic and there is the Oil Empire, the Defense Empire, the Financial Empire and the USD Empire

their political centers of gravity aren't all the same. in the first case, it's Washington, DC

in the second case, it's an axis between Washington and Ryad, and in the fifth case it's an axis between Washington and NY's financial interest networks, expressed in the NY-FED

each of those five nexus points of interests has a life of it's own. the "demise" of one of them does not necessarily result in the demise of others

Joe A's picture

America is pissing off European allies in such a fast pace that one would almost think it is deliberate.

lakecity55's picture

It is 100% deliberate.

Eyeroller's picture


As far as Teflon Barry is concerned, I think it is gross incompetence.  His incompetence is directly proportional to his ego.  He truly believed that once he got into office that all the Muzzie countries would cease to hate America and Europe would fawn over him like the US press does. 

Foreign nations see him as the weak leader he is, and this is why they are emboldened to plot the destruction of the USD.  They aren't the slightest bit concerned about any "red line" consequences.

Saying that the downfall of America is all "by design" is really giving too much credit to Obama.  If anything, the real credit belongs with the voter who chose to vote for free stuff instead of the strong medicine it would take to get the economy turned around. 



Lea's picture

All that was to be expected. A French economist said, right after the BNP shebang unfolded, that the Americans were shooting themselves in the foot. He declared "what's the American message on this one? If the dollar is a pain in the neck, simply drop the dollar, dudes. Simple enough".

My bet is that other countries will rapidly follow, as nobody likes the threat of huge fines.

That was a seriously dumb move.

Ocean22's picture

Unless they WANT the dollar to crash. (Which they do )

Circle of DNA's picture

France should be bombed into democracy by the Anglo-Zionist freedom fighters very soon. They will have a wonderful, LGBT, full color spectrum revolution and the hallucinations of freedom will forever be imprinted in their estrogenic-GMO-modified brains.

JohninMK's picture

Well spotted.

So it is now Germany/UK/France/S Korea/Australia/New Zealand direct dealing in Yuan.

South Korea, a real US dominated state that is the news, not France.

kchrisc's picture

Fat lady just started her third aria.

lakecity55's picture

I think the bath house has been ordered to kill the dollar by 2016; the French banker is correct- it is an accelerating process along an exponential curve.

The invasion from the south is intended to exterminate sovereignty towards a NAU monetary unit.


CCanuck's picture

KC, will she be joining you on the Kareoke Tour?

yogibear's picture

The Crash of the US dollar should be devistating for the 99%.

g speed's picture

I think it's a good thing for the US to get away from having it's fiat as the worlds reserve.  Maybe we can get on with business at home --clean up our politics and adjust our priorities. World banks are world banks and will do business in what ever--no change there.---big change will happen in US foreign policy -- no more bombing around the world. No more nation building-- more of a Ron Paul type of USA-- no more foreign aid -- no more Import Export Bank-- --No more big military bases around the world-- No more exporting inflation so chickens come home to roost. --  Lots of good stuff can happen. --Maybe even fair stock markets with interest rates normalized with out the FED supporting the crooks of the world-- maybe big crime will use something other than the dollar??  just saying.

Kprime's picture

no intent to be unkind or diss u, but what drugs are causing these wild hallucinations?

g speed's picture

just everyday business and stuff thats happining in politics --like the "new speaker of the house" going on record to wanting to get rid of the Export Import Bank.  --- the bundy ranch-- the Iraq debacle --- more people wanting to have less gov't.----Obama care ---waking up on the 9/11 events-- fewer "greatest generation" voters---IRS scandal -----Snowden---general US populations view of Israeli aparthed-- US voters realizing the level of "hate USA" vitrol around the world--TSA in airports--

Oh yea the drugs---it's the war on drugs and the resulting loss of freedoms that the avereage US citizen is feeling--and the Patriot Act ---

IMHO the tide is turning--- 

I've been around since the early 1940s and have seen a lot of changes---I don't have to rely on schools and books and the net for my recent history lessons-- I just look in my photo album to see the patterns---

drendebe10's picture

Fat Frackin chance, fat frackin chance..

Oldrepublic's picture

very glad  to see the French standing up to  the blatant blackmail of the American government over the sale of the Mistral warships to Russia.  Noyer’s  statement  regarding the future of the dollar  is indeed foreboding.

viahj's picture

true, but it is disheartening to see all the US vs. France stereotype bickering going on in here.  divide and conquer ensures the continuation of the global oligarchy and their systems.

atthelake's picture

STOCK UP, if you can, on food, fuel, drink, meds, supplies and heirloom seeds because this cannot end well.

WillyGroper's picture

My thoughts exactly. Dried beans are fine but what if you've got no power or fuel?

Canning some nice fava beans & chickpeas tomorrow. 

DarthVaderMentor's picture

Obama and Michelle are behind schedule in destroying America. Bill Ayers is clearly disappointed.

nathan1234's picture

Would that be Michael and not Michelle.?

NoWayJose's picture

As long as the Fed can create trillions of dollars and flood them into other central banks, global commercial banks, bond and stock markets, etc - the US will have no real trouble. The Fed cronies can manipulate markets to move any 'real' asset in the direction they desire - and leverage their positions many times over. This will work until the dollar collapses - and the Fed's actions are themselves hastening the day.

kurt's picture

France and everything east will be a Fuku-Chernobyl Dead Zone. They have too many nuke power stations, and nuclear weapons. Can you say toxic hell hole of death. Germany in moving away from nukes was smart but will have to live in domed cities and underground. Bullish excavating equipment, tunneling, full spectrum lighting. All that radiation will move east mixing with the cloud from the Ruso-Ukrainian-Americo-Israel-Muslim War. That in turn moves east killing China. Soon it rains down into the Pacific completing the death of that ocean. Bullish filtration, radiation mitigation, synthetic foods, think fungus algae. At first the winter will be at least three years. Bullish stored foods. See? I'm not all negative.

IndianaJohn's picture

kurt, -- did you see the one about the Babushkas;

kareninca's picture

thank you for linking that

Bear's picture

This Administration is the epitome of cluelessness ... these are the best and brightest America has to offer? 

Jackagain's picture

Not sure....but they are the most corrupt...

August's picture

If you're a Top Graduate from a Top University, you go on into either a lucrative FIRE industry position, or into "Governance".  Either way, these people are the cream of the crop.

yogibear's picture

Crash the US dollar already! The Federal Reserve wants it as well. Their doing everything they can to devalue it big time.

lakecity55's picture

How about the owners of the B for IS is ordering their branch bank, the Fed, to devalue it so they can profit off the East?

Banjo's picture

Oh wow another big accident slash blunder by the US. Just like 9/11 all just dumb luck, air force intellignce agencies all failed at the same time.


Banjo's picture

Oh wow another big accident slash blunder by the US. Just like 9/11 all just dumb luck, when air force and intellignce agencies all failed at the same time.


Crazed Smoker's picture

Well that's not good because France's economy is even larger than Russia's. Oye.