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DE-DOLLARIZATION:
THE REVOLT AGAINST THE DOLLAR AND THE RISE OF A NEW FINANCIAL WORLD ORDER

The dollar's status as the world's preeminent currency, together with the U.S. military, has underlain American power since World War II. In a sweeping review of one of the most seminal yet least noticed developments in international affairs, Gal Luft and Anne Korin describe how an emerging coalition of revisionist countries, rogue governments, techno-visionaries and sanctioned entities, buttressed by innovations like blockchain and 5G, are working to push the dollar off of its reserve currency throne. It would not be the first time. Preceding the dollar, five consecutive currencies, each belonging to a superpower of the time, ruled the markets. Each predominated for roughly 80-100 years, and as it tumbled to irrelevance it accelerated the decline of the empire behind it. Are we due for a rerun?

 
 
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Trump’s Embrace of Sanctions Irks Allies and Prompts Efforts to Evade Measures

Echoing our main argument in De-dollarization the New York Times argues that the US increasing reliance on economic sanctions to solve foreign policy problems is fueling concern that the US is abusing its financial power and prompting some governments to seek ways to evade American measures.

in the article Steve Mnuchin acknowledged that over “a long period of time” there was a risk that the rest of the world could shift away from the dollar as the reserve currency and that the United States must be responsible with how it wielded sanctions. But he suggested that, for now, other countries have little choice but to comply. “The reason why they are so effective is because the dollar is the reserve currency of the world,” Mr. Mnuchin said. “Other countries may not like adhering to our sanctions, but because the dollar is the reserve currency and their banking systems are attached to dollars and dollars are a major component of trade, that’s why people have to cease activities [with Iran].”


 

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