Venezuela Is About To Ditch The Dollar In Major Blow To US: Here's Why It Matters

Authored by Darius Shahtahmasebi via TheAntiMedia.org,

Venezuelan President Nicolas Maduro said Thursday that Venezuela will be looking to “free” itself from the U.S. dollar next week, Reuters reports. According to the outlet, Maduro will look to use the weakest of two official foreign exchange regimes (essentially the way Venezuela will manage its currency in relation to other currencies and the foreign exchange market), along with a basket of currencies.

According to Reuters, Maduro was referring to Venezuela’s current official exchange rate, known as DICOM, in which the dollar can be exchanged for 3,345 bolivars. At the strongest official rate, one dollar buys only 10 bolivars, which may be one of the reasons why Maduro wants to opt for some of the weaker exchange rates.

“Venezuela is going to implement a new system of international payments and will create a basket of currencies to free us from the dollar,” Maduro said in a multi-hour address to a new legislative “superbody.” He reportedly did not provide details of this new proposal.

Maduro hinted that the South American country would look to using the yuan instead, among other currencies.

“If they pursue us with the dollar, we’ll use the Russian ruble, the yuan, yen, the Indian rupee, the euro,” Maduro also said.

Venezuela sits on the world’s largest oil reserves but has been undergoing a major crisis, with millions of people going hungry inside the country which has been plagued with rampant, increasing inflation. In that context, the recently established economic blockade by the Trump administration only adds to the suffering of ordinary Venezuelans rather than helping their plight.

According to Reuters, a thousand dollars’ worth of local currency obtained when Maduro came to power in 2013 is now be worth little over one dollar.

A theory advanced in William R. Clark’s book Petrodollar Warfare – and largely ignored by the mainstream media – essentially asserts that Washington-led interventions in the Middle East and beyond are fueled by the direct effect on the U.S. dollar that can result if oil-exporting countries opt to sell oil in alternative currencies. For example, in 2000, Iraq announced it would no longer use U.S. dollars to sell oil on the global market. It adopted the euro, instead.

By February 2003, the Guardian reported that Iraq had netted a “handsome profit” after making this policy change. Despite this, the U.S. invaded not long after and immediately switched the sale of oil back to the U.S. dollar.

In Libya, Muammar Gaddafi was punished for a similar proposal to create a unified African currency backed by gold, which would be used to buy and sell African oil. Though it sounds like a ludicrous reason to overthrow a sovereign government and plunge the country into a humanitarian crisis, Hillary Clinton’s leaked emails confirmed this was the main reason Gaddafi was overthrown. The French were especially concerned by Gaddafi’s proposal and, unsurprisingly, became one of the war’s main contributors. (It was a French Rafaele jet that struck Gaddafi’s motorcade, ultimately leading to his death).

Iran has been using alternative currencies like the yuan for some time now and shares a lucrative gas field with Qatar, which may ultimately be days away from doing the same. Both countries have been vilified on the international stage, particularly under the Trump administration.

Nuclear giants China and Russia have been slowly but surely abandoning the U.S. dollar, as well, and the U.S. establishment has a long history of painting these two countries as hostile adversaries.

Now Venezuela may ultimately join the bandwagon, all the while cozying up to Russia, as well (unsurprisingly, Venezuela and Iran were identified in William R. Clark’s book as attracting particular geostrategic tensions with the United States). The CIA’s admission that it intends to interfere inside Venezuela to exact a change of government — combined with Trump’s recent threat of military intervention in Venezuela and Vice President Mike Pence’s warning that the U.S. will not “stand by” and watch Venezuela deteriorate — all start to make a lot more sense when viewed through this geopolitical lens.

What initially sounded like a conspiracy theory seems to be a more plausible reality as countries that begin dropping the U.S. dollar and opting for alternative currencies continuously — and without exception — end up targeted for regime change.

If the U.S. steps up its involvement in Venezuela, the reasons why should be clear to those who have been paying attention.

*  *  *

This moves comes just days after The BRICS Summit where Putin unveiled his "fair multipolar world," which culminated, as Pepe Escobar explained, in the following

Meet the oil/yuan/gold triad

It’s when President Putin starts talking that the BRICS reveal their true bombshell. Geopolitically and geo-economically, Putin’s emphasis is on a “fair multipolar world”, and “against protectionism and new barriers in global trade.” The message is straight to the point.

The Syria game-changer – where Beijing silently but firmly supported Moscow – had to be evoked; “It was largely thanks to the efforts of Russia and other concerned countries that conditions have been created to improve the situation in Syria.”

On the Korean peninsula, it’s clear how RC think in unison; “The situation is balancing on the brink of a large-scale conflict.”

Putin’s judgment is as scathing as the – RC-proposed – possible solution is sound; “Putting pressure on Pyongyang to stop its nuclear missile program is misguided and futile. The region’s problems should only be settled through a direct dialogue of all the parties concerned without any preconditions.”

Putin’s – and Xi’s – concept of multilateral order is clearly visible in the wide-ranging Xiamen Declaration, which proposes an “Afghan-led and Afghan-owned” peace and national reconciliation process, “including the Moscow Format of consultations” and the “Heart of Asia-Istanbul process”.

That’s code for an all-Asian (and not Western) Afghan solution brokered by the Shanghai Cooperation Organization (SCO), led by RC, and of which Afghanistan is an observer and future full member.

And then, Putin delivers the clincher;

“Russia shares the BRICS countries’ concerns over the unfairness of the global financial and economic architecture, which does not give due regard to the growing weight of the emerging economies. We are ready to work together with our partners to promote international financial regulation reforms and to overcome the excessive domination of the limited number of reserve currencies.”

“To overcome the excessive domination of the limited number of reserve currencies” is the politest way of stating what the BRICS have been discussing for years now; how to bypass the US dollar, as well as the petrodollar.

Beijing is ready to step up the game. Soon China will launch a crude oil futures contract priced in yuan and convertible into gold.

This means that Russia – as well as Iran, the other key node of Eurasia integration – may bypass US sanctions by trading energy in their own currencies, or in yuan.

Inbuilt in the move is a true Chinese win-win; the yuan will be fully convertible into gold on both the Shanghai and Hong Kong exchanges.

The new triad of oil, yuan and gold is actually a win-win-win. No problem at all if energy providers prefer to be paid in physical gold instead of yuan. The key message is the US dollar being bypassed.

RC – via the Russian Central Bank and the People’s Bank of China – have been developing ruble-yuan swaps for quite a while now.

Once that moves beyond the BRICS to aspiring “BRICS Plus” members and then all across the Global South, Washington’s reaction is bound to be nuclear (hopefully, not literally).

Washington’s strategic doctrine rules RC should not be allowed by any means to be preponderant along the Eurasian landmass. Yet what the BRICS have in store geo-economically does not concern only Eurasia – but the whole Global South.

Sections of the War Party in Washington bent on instrumentalizing  India against China – or against RC – may be in for a rude awakening. As much as the BRICS may be currently facing varied waves of economic turmoil, the daring long-term road map, way beyond the Xiamen Declaration, is very much in place.

Comments

onmail1 Sep 11, 2017 12:00 AM Permalink

Dollar is an instrument of slaveryEuro is an instrument of slaveryPound is an instrument of slaveryThe western white man wants entire world to serve himand ur daughters cunts for as little as 20$ a piece==========Let all nations get nukes and point them at the westthose who colonised u and enslaved ulet them be enslaved or be eliminated 

onmail1 Sep 10, 2017 11:59 PM Permalink

Dollar is an instrument of slaveryEuro is an instrument of slaveryPound is an instrument of slaveryThe western white man wants entire world to serve himand ur daughters cunts for as little as 20$ a piece==========Let all nations get nukes and point them at the westthose who colonised u and enslaved ulet them be enslaved or be eliminated 

FreeEarCandy Sep 9, 2017 6:02 PM Permalink

When I first read this article I got pulled in to the idea that the US petrol $ was about to fall. This can't happen as long as oil makes the world go around. The US $ is not really a fiat currency if it is supported by oil, and the demand for oil is unmatched. The use for gold doesn't even come close to the ways we use oil, and the USA is sitting on a ocean of fossil fuel. In the past we set up an agreement with Saudi Arabia, but today we could prop up our $ without them. It is China's currency that is in peril. That is why they are planning to back it with gold. They have no oil or agreements. Venezuela needs gold because its entire economy is supported by oil revenue. When the USA discovered its new found oil it drove the price of oil down so low that Venezuela's oil based economy crashed with the price of oil. Hence, Venezuela is going to sell its cheap oil for gold, but frankly its really not going to help them much until the price of oil rises. $50 a barrel oil will only get one $ 50 worth of gold, and if the price of gold falls too, then that is 2 steps backwards. The only thing that props up China's Yuan is cheap labor. That is about to change because robots are going to replace slave labor. Without the demand for slave labor to support the Yuan, the Yuan will fall like a rock in the ocean and have no means to recover. Hence, China is running around the world trying to buy up as many assets as it can, while the Yuan is still floating on slave labor. They are seeking minerals and real estate where ever they can find them for sale. This gold backed Yuan is no threat to the US dollar as long as the US has its own oil to back it up and oil remains in demand.Gold is nearly useless in terms of necessity. Oil is king and China is a land of desperate peasants that are about to be replaced with robots and AI.  Throw possible Tariffs and sanctions into the mix and this demise will accelerate.   

Jack Oliver FreeEarCandy Sep 9, 2017 8:28 PM Permalink

I doubt it - the future of energy is CNG - Russia has shitloads of it AND have been building 'pipelines' for the last 20 years !!

They KNEW what the future held and have prepared accordingly !!

NB - Russia don't have to 'frack' for gas !! It comes out like a geyser !!

Russia has an easy 'pivot' to Europe and Asia for the CNG !!

CNG will be the 'bridge' toward ( ultimately) FREE energy !

In reply to by FreeEarCandy

Greed is King 0hedgehog Sep 9, 2017 5:36 PM Permalink

Soon; but America won`t find Venezeula the walk in the park Iraq was, Iraq was surrounded by enemies, even Americas enemy Iran would`nt help Saddam Hussein, but Venezeula is surrounded by South American and Central American allies, all of whom have good reason to hate the USA, they WILL help Venezeula. America in Venezeula will be invading another Vietnam.

In reply to by 0hedgehog

any_mouse Sep 9, 2017 5:06 PM Permalink

"A theory advanced"

This is way beyond theoretical.

Global Force for the Petrodollar.

Has any nation in history ever successfully defended the World's Reserve Currency when in decline?

Joiningupthedots Sep 9, 2017 4:17 PM Permalink

These articles always return to what America can/will do to other countries economiesHas anyone really examined the American economy?ITS A FUCKING SHAMBLES and based on nothing more than printing money. The writing is on the wall for Pax Americana. It either accepts its demise or gets destroyed completely trying to fight it.The entire "American Doctrine" BS is so yesteryear and two thirds of the world dont listen anymore.

gdpetti Joiningupthedots Sep 9, 2017 5:24 PM Permalink

the SG have been prepping for another global war for quite some time... these things take time to engineer, especially this time with the approach of Mother Nature and the end of our realm as we know it, as the NWO is up for grabs. The option for WW3 is whether or not it goes nuclear, not whether it happens, as the SG can trigger that 'black swan' any time they want, as we've seen repeatedly over the centuries of history as we know it... what's left of it, not burned or destroyed by man or nature.They will pull the rug out... not if but when and in what sequence... Maduro wasn't prepped for this role, so he's had to learn as he went on, Chavez didn't stay safe like Castro has all these years, we go to Chavez with a nice little dose of sudden stage 4 cancer. Fidel was always on the lookout for our operators... and what we are doing in Venezuela is the same as we do everywhere with our Economic Hitmen and Jackals... banksters and mercenaries/terrorists/idiot soldiers etc.... all expendable, exceptionally so.Maduro needs to ask RC for some advice, Putin would be better in this line, as Venezuela is dealing with some problems that Castro never had to deal with... like having a oil/gas operation in the States... who to sell to? the Congress is working on making any RUssian buyin illegal.... essentially this is how the SG pushes the Deep State to push their DC puppets in the establishment to do their bidding... prepping for WW3... not if, but when and how? will it go full nuc? depends upon how the hands are played in this poker game. Usually it's best not to announce your intentions but to just do them and let your opponent deal with the fiat accompli.Hopefully Maduro has prepped for this and not just made an annoucement out of the blue.

In reply to by Joiningupthedots

Radical Marijuana Sep 9, 2017 4:37 PM Permalink

The article above appears to a very BELATED coming around to proper perception by an author associated with TheAntiMedia.org:

"In Libya, Muammar Gaddafi was punished for a similar proposal to create a unified African currency backed by gold, which would be used to buy and sell African oil. Though it sounds like a ludicrous reason to overthrow a sovereign government and plunge the country into a humanitarian crisis, Hillary Clinton’s leaked emails confirmed this was the main reason Gaddafi was overthrown. ... What initially sounded like a conspiracy theory seems to be a more plausible reality as countries that begin dropping the U.S. dollar and opting for alternative currencies continuously — and without exception — end up targeted for regime change."

The government of the USA, as certainly also all other NATO countries, has been dominated by the international bankers for more than a Century. Access to the world's natural resources is controlled by the monetary system, and therefore, the international bankers became the best organized gangsters, the banksters. Almost all of the successful politicians in NATO countries are those banksters' puppets, while the majority of people that vote for them are muppets, who have been brainwashed to believe in the banksters' bullshit throughout their lives, for generation after generation, by the schools and mass media.Inside that context, the series of articles republished on Zero Hedge from TheAntiMedia.org have usually been gross understatements, which I have routinely found to be laughably hypocritical expressions of controlled "opposition," whereby "AntiMedia" is barely so, due to the degree that the authors tend to continue to take for granted perceiving politics in the same frame of reference that the mass media also do.Similarly, Zero Hedge articles and comments tend to rather routinely make the silly, superficial assertions that Venezuela's problems are due to it being "socialist," which is a term often bandied about in ways which have nothing in common with either the dictionary definitions nor the actual social facts.THERE IS ONLY ONE POLITICAL SYSTEM, ORGANIZED CRIME.However, since the biggest forms of organized crime are governments, which are dominated by the best organized gangsters, which are currently more the banksters than any other group, almost everyone tends to automatically take for granted using the language of DUALITIES, false fundamental dichotomies, and the related impossible ideals. Public political discourses are drowning in the biggest bullies' bullshit, which became the banksters' bullshit. Although it is theoretically possible to better reconcile physical science with political science, that is generally NOT done because doing so requires series of intellectual scientific revolutions and profound paradigm shifts.If one considers human beings and civilization from the perspective of general energy systems, including cybernetics, etc., then one perceives that civilization necessarily operates according to the principles and methods of organized crime. Since human beings and civilization are actually nested toroidal vortices engaged in entropic pumping of environmental energy flows, human beings and civilization actually operate through UNITARY MECHANISMS, because it is all the same energy. However, the dominate natural languages and philosophy of science have the biggest bullies' bullshit-based world view built into them, such that almost everyone takes for granted thinking in terms of DUALITIES. While physical sciences, and especially mathematical physics, have made prodigious progress in replacing DUALITIES with UNITARY MECHANISMS, political science has barely made any progress. Instead, almost all public debates regarding politics are deliberately irrational. Various governments which are in conflicts with each other are actually different dominant organized crime gangs that are in conflict.The supreme achievement of organized crime is legalized counterfeiting. Being able to make "money" out of nothing as debts, while the powers of public governments enforce those frauds by private banks, is practically of infinite value!  Here is a link to a relatively good article which sets out the background to the contemporary events "as countries that begin dropping the U.S. dollar and opting for alternative currencies continuously — and without exception — end up targeted for regime change." https://ellenbrown.com/2013/09/04/making-the-world-safe-for-banksters-s…Making the World Safe for Banksters: Syria in the Cross-hairsPosted on September 4, 2013, by Ellen Brown.The authors associated with TheAntiMedia.org appear to gradually coming around to recognize that accumulating apparent anomalies, that enable some to recognize that many of the most important "conspiracy theories" are FACTS. However, because the authors associated with TheAntiMedia.org are NOT able and willing to go through more profound paradigm shifts, the results continue to be relatively silly, albeit superficially correct, analyses. The abilities of the international bankers to capture almost complete control of the USA government, as well as the governments of all other NATO countries, has been the root cause of current geopolitical events. Follow the "money" to its source, to observe the vicious feedback spirals of the funding of the political processes, which are automatically becoming worse, faster ...The essential social facts are due to the history of the murder systems directing the development of Globalized Neolithic Civilization. Militarism, the ideology of the murder systems, has recognized for thousands of years that successful warfare depended upon deceits and treacheries. Indeed, warfare was the development of the methods of organized crime on larger and larger scales. Being able to back up deceits with destruction enabled the development of a globalized political economy based on ENFORCED FRAUDS, while about exponentially advancing technologies have enabled those to become about EXPONENTIALLY MORE FRAUDULENT. To put that another way, the excessively successful control of Civilization by the methods of organized crime has resulted in Civilization manifesting runaway criminal insanities, spinning out of any human control.There are NO significant exceptions anywhere in the world to the ways in which ALL countries, corporations, and churches, are systems of more or less organized lies operating robberies. The essential nature of the banksters' ENFORCED FRAUDS are that those act as SYMBOLIC ROBBERIES. There is nothing else which compares in the same order of magnitude as those SYMBOLIC ROBBERIES achieved by legalized counterfeiting. Since ALL the sociopolitical systems of Neolithic Civilization were based on being able to back up lies with violence, while being able to do so never stops those lies from still being fundamentally false, Globalized Neolithic Civilization is spinning out of control, due to social "realities" becoming more and more psychotically detached from relatively objective physical and biological facts. Since the significant sociopolitical systems are actually based on ENFORCING FRAUDS, those sociopolitical systems are operated by the best available professional hypocrites, while, at the present time, the Venezualan government seems to be dominated by less professional hypocrites than the USA government.

deepfriedbrain Sep 9, 2017 2:59 PM Permalink

I think the peeps are missing the big picture.  this is China's gambit...not Maduro's.  BRICS is dead..India is out.  If china overplays their hand India will get the MFN status in the US and china is royally screwed.  China has betted on some losing horses (pakistan &  venuzvuela) only bc Trump played his hand differently than the past US leadership....now the margin calls for these bets are  starting to get expensive. If China loses the MFN status it will be very difficult to prop up the vassal states it props up. F'em  ...they deserve it.

Nobodys Home Sep 9, 2017 2:01 PM Permalink

When I talk to people about the inevitable collapse of the petrodollar they look at me like I have a squirrely eye that focuses to the side. It will, IMO, happen during my lifetime...and probably soon. The writing is on the wall.

PS: Bitcoins are shit coins :)

DemandSider Sep 9, 2017 1:57 PM Permalink

American fossil fuel expansion was a surgical strike on oil dependant socialist systems worldwide, and Russia. But, the sanctions have backfired:Russia Becomes a Grain Superpower as Wheat Exports Explode By Anatoly Medetsky October 6, 2016, 6:00 PM CDT October 7, 2016, 10:51 AM CDT

  • Rising investment and falling ruble help drive output
  • Russia returning to wheat-export lead last held under Czars

https://www.bloomberg.com/news/articles/2016-10-06/russia-upends-world-… 

FreeEarCandy Sep 9, 2017 1:12 PM Permalink

China's gold backed paper scheme is really a sign of China's weakness. That weakness is their dependency on oil and they have none of their own. We can take all their gold in a short time. We don't need to back our currency with gold because we have an ocean of oil that the world wants more than gold. Can't use gold to run a factory or run a car. In fact, a golden cob of corn is more useful than a gold coin, and in the end, it is the things that are useful to us that we really want. Gold and paper is way down at the bottom of the list. This is not going to go well for China. Indeed, Venezuela needs gold to get them out of the hole they find themselves in, and they like the gold backed Yuan very much.  Venezuela is going to suck China's golden dick as a means to their end, but the USA has a lot of oil too, and we will be happy to take China's gold until it is all gone. Then what? Moreover, robots are going to put the $3 a day China man/woman labor out of business. China can back its currency with all the gold it wants, but the petrol dollar is not going anywhere until the world no longer desires oil over gold. 

Faeriedust Sep 9, 2017 1:11 PM Permalink

U.S. policymakers are just plain outta luck.  Trade between Russia and China goes back to at least 900 BCE with the Skythians and connects the heart of human civilization; those of us settled on the American continents are mere savages in comparison.  For a brief period we were the world's greatest engineers, but frankly, that time has come and gone.  There is nothing we produce now that they can't get elsewhere, often of better quality.  They've already copied all of our most advanced technology. Recent foolishness with "sanctions" on Russia have merely proved (as they did in the 1920's-60's) that those consummate survivors can manage without us.  And unlike Stalin, Putin can turn to a fully-developed technological and industrial base in China for those things that the Russians don't do extremely well.  The U.S. strategy has passed its pull date; not surprising since it's being run off of a playbook developed by the British Empire under Queen Victoria.

gcjohns1971 Sep 9, 2017 12:55 PM Permalink

This article is stupid.Putin & BRICS, and Venuzuela's Bolivar exchange situation have nothing to do with one another.Nothing Putin said is wrong...it just has nothing to do with Venuzuela.Venuzuela will devalue because their official rate is a joke.  They devalued their nation's economy by seizing everything of value and then running them via political calculus rather than economic...a.k.a. "Socialism".The same thing happened in Venuzuela as everywhere else that has been done - they destroyed their economy.  Were it not addictive as crack cocaine to politicians and oligarchs, Socialism would not be promoted because it is a more sure means of suicide than nuclear war.Venuzuela will "leave" the dollar because no one will give them dollars for Bolivar.

gcjohns1971 Faeriedust Sep 10, 2017 8:30 AM Permalink

Chinese will give them Yuan for oil.  Chinese will not give them Yuan for promises of oil.When you distribute the means of production via "Social" (political) calculus rather than economic, the inputs to production don't get paid for, leading to slow but totally certain decline of infrastructure.Venuzuela is far down this road.To the extent the oil won't jump from the ground into barrels of its own accord, Venuzuela has nothing to sell but empty promises and Misery.

In reply to by Faeriedust

MoreFreedom Sep 9, 2017 11:37 AM Permalink

What the failed state of Venezuela does hardly matters.  That the Chinese are making a market in oil where they pay in gold matters a lot.  It will reduce bank holdings of dollars, with the dollars coming back to the US to purchase stuff like real estate in the US, or other exports, leaving the US holding the paper dollars. That will help speed the demise of the US dollar.  

east of eden Sep 9, 2017 11:54 AM Permalink

At least half the US population (the ones who voted for and/or support Trump), plus a good portion of democ-rats, who also support draining the swamp, have had it up to their eyeballs with your 'global policeman role'. It is expressly forbidden by your Constitution, but, hey, the Constitution hasn't been enforced for decades now. The biggest lie and biggest deceit is actually one that was conducted against you, by the Federalists (Adam Smith and co.) who took their orders from London (i.e. the Khazarians to whom they had become deeply indebted).They have used and abused you, killed millions of your fighting men and women (with their crazy/stupid ideas of warfare - case in point, the Battle of the Somme - 250K dead and 600K wounded or missing in 6 months), drained your treasury and left you with 'funny paper', taken all your resources and destroyed your land, air and water. If you really want to assign blame where it properly belongs, look no further than the British 'House of Lords'. They were not your friends in 1776 and they most certainly were not your friends on the battlefields of WW 1 and WW 2 where their gross incompetence killed a lot of yanks as well as mounds of their own 'disposables'. Although I will say, that one has to really look hard at their so called 'incompetence' and wonder if it wasn't planned that way, by darker forces at work.As another good example of 'gross british incompetence', I will once again refer to the unfortunate war of 1812-14 between 'Canada' and the US. With 2,800 men, 800 of which were Indian warriors led by Joseph Brant and then Techumseh, 1800 more were simple farmers who formed into militas, and only 200 British irregulars most of whom were considered 'throw aways' by the big boys back home, we had taken over half of the north eastern portion of the US. We were parked in western Pennsylvania, when Napoleon was defeated on the continent, and we received 'Britsh Commanders' in NA, who promptly lost every inch of ground we gained. The worst defeat coming in the Battle of New Orleans, when, once again, the British went 'A Bridge Too Far'. But you can't tell them anythign. Never could they are so full of themselves.The only thing a 'British Lord' has ever cared about is how much money he could make in the morning so he could brag over Brandy and cigars in the afteroon. And besides, the so called 'British' who were really once Celts, are not British, they are German, from the Norther Areas of Germany, who held the south of England, but not London. They were the ones who really destroyed the Celtic culture, because it's life philosophy did not fit well with their own. An interesting peice of research is when you look into the story of South Africa. Lord Thompson of Fleet hooked up with, you guessed it, the zionists (i.e. the Rothschilds), and plundered the gold for over 100 years, then, quietly left to let others hold the bag for them.When you finally come to your senses and realize that Trump supporters and those of us who want a quieter, more peacefull world, will NEVER AGAIN accept your lies, and deceits and bullying. Never.So, better get started on trying to figure out how to be better people, for your own country and for the sake of all the rest of us.

FreeEarCandy Sep 9, 2017 11:18 AM Permalink

When and if this happens, and I do think it will happen, those that sell oil can demand whatever currency they choose. They will likely demand a currency that is deemed the most secure with regards to its ability to hold value, such as a gold backed currency. Hence, "Meet the oil/yuan/gold triad".Nevertheless, one can have a currency backed by 100% gold, but if said country is not well protected by a military, then they and their gold backed currency is not so secure. Muammar Gaddafi realized this a little too late. So the bottom line is, as long as the world is dependent on oil this bullshit is going to run its course, and there will be a race towards gold and guns to prop up and secure the currency of ones country.So how does one win this new game? If one can become less dependent on oil, one doesn't need a shit load of paper currency backed by gold. Hence, the value of ones currency will increase. If I have only one bar of gold to back 1000 piece of paper, the only way I can make my currency more valuable is by reducing the quantity of paper I print. 100 pieces of paper backed by the same bar of gold makes my currency ten times more valuable, and couple that with a very strong military and you have a very secure and valuable currency. Such a currency will be in high demand by virtue of its rarity, security, and value. Thorium Nuclear Reactors are considered safer and produce more energy and less waste than traditional nuke reactors. It is not the end all solution but the point I am driving at with regards to currency war is the less we have to buy from abroad the less paper we will have to print to facilitate purchases and reliance from abroad. Less paper means more gold backing the currency.   Another option ...China is not a resouce rich country and will need a lot of gold backed paper to buy from the rest of the world. Russia has a lot of resouces, but it does not have anywhere near the quantity of gold the USA has in reserve. Even if China and Russia collaborate, the EU and the USA could do the same and combine their gold reseves to issue a currency that would dawrf anything that China and Russia could come up with. Add in the military componate and I think that would just about put the China/Russian team under the grass rug.Any other ideas?

FreeEarCandy konadog Sep 9, 2017 5:13 PM Permalink

After rethinking this China's gold backed paper scheme is really a sign of China's weakness. That weakness is their dependency on oil, and they have none. A lot of people think the US dollar is not backed by anything, but it is indeed supported by oil. In the past it was supported by Saudi oil in exchange for protection, but recently we discovered so much oil, via fracking, the USA is essentially supporting its own $. When it really comes down to necessary useful demand oil is king. Gold cannot even come close to oil when one thinks in terms of usefulness and necessity. The way I see it, if there is anyone on the world stage that is issuing funny money it is China. China has no oil or minerals that have high enough demand, nor do they have any agreements like the US and Saudi petrol $ agreement. Hence, gold is the best they can do to prop up the Yuan and use it to buy the oil they need. Indeed they will save a little money, by avoiding the need to exchange Yuan for US dollars, but in the long run China may run out of gold, especially when robots decrease the demand for cheap Chinese labor.  When the robots come on line in force, China will lose its status as the worlds manufacturing center. Companies will move closer to the resources they need and the markets where they sell their goods and service. A $3 a day worker in China will not be able to afford a TV, so China offers no market and it has no resources. What will China do?  We can take all their gold in a short time. We don't need to back our currency with gold because we have an ocean of oil that the world wants more than gold. Can't use gold to run a factory or run a car. In fact, golden corn is more useful than a gold coin, and in the end, it is the things that are useful to us that we really want and place value in. This is not going to go well for China. Indeed, Venezuela needs gold to get them out of the hole and they like the gold backed Yuan very much.  Venezuela is going to suck China's golden dick as a means to their end, but the USA has a lot of oil too, and we will be happy to take China's gold until it is all gone. Then what?Now, had China invested in Thorium nuclear reactors they could solve their energy concerns, but they didn't, and now it looks like the world is about to cut off their golden balls for a trophy. The petrol dollar will not be in anyway defeated until the demand for oil is no more. As of right now, oil makes the world go around, so I have no concerns any longer about a gold backed currency. As I see it, a gold backed currency is a move of desperation on China's part. China has no oil and the only thing holding their currency up at this moment is slave labor, which is about to face the robot revolution. China is between a rock and a hard place, and they don't have any oil to protect them from the friction they are about to experience.  

In reply to by konadog

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