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5 out of 10 leading economies abandoned the dollar
Material posted: Publication date: 18-04-2013

The US dollar is rapidly losing its status as the world's reserve currency. Five of the ten leading economies of the world, along with several others no longer use the dollar as an intermediate currency when trading. This trend is for the dollar and for all of the United States at risk.

Australia, being the 12th largest world economy, has joined the growing list of countries that have agreed to abandon the dollar in bilateral trade with China. China, being the second largest economy in the world after the U.S., also has similar agreements with Japan (3rd place), Brazil (6th), India (9th) and Russia (10th).

Although unilateral agreements have already for some time taken place between China and the countries listed above, last week the BRICS agreed to create a development Bank to rival the IMF, which indicates that it is created for operation in conditions of "pokedollars" of the world.

In addition, Brazil, which some time ago has agreed in principle to withdraw from the dollar in bilateral trade with China, just made it official, creating an annual $30-billion currency swap, which will facilitate about 50 per cent of trade between them.

In addition to these agreements with China, some of these countries signed the same agreement with each other. India and Japan in 2011 founded the $15-billion swap their currencies for bilateral trade. And sanctions against Iran did not stop its oil trade with China, Russia and India in anything but the dollar.

Here's how the current reign of the U.S. dollar compared with the previous global reserve currencies:

It seems that the dollar is nearing the end of his reign, which can lead to serious economic difficulties for the United States.

Dave Hodges writes:

Good economic condition of the United States is due exclusively to the fact that world must use the dollar, if you want the petrodollar to buy oil for their needs; that provides the only source of support for the US dollar, which requires the Federal reserve to maintain our unsustainable debt.

And Marin Catoosa from Casey Research writes:

If the U.S. dollar will lose its position as the world's reserve currency, the consequences for America will be grave. The bulk of the value of the dollar stems from its Association with the oil industry — if that monopoly will order to live long, the same thing will happen to the value of the dollar. Such an important transition period in relations between the world's Fiat currencies will positively impact some, and negatively to the other world currencies, the end result which is very difficult to predict. However, there is one result that can be predicted almost certain: gold will go up. Uncertainty around paper money always bodes well for gold, and the current time is a time of uncertainty.

Imperialism of America in conjunction with the endless buildup of debt seems to be leading to the formation of deadly dive, which will absorb and will drown many of the leading at the moment, the economy of the world. And perhaps it will take quite some time before the rest will follow. So today would be a great time for reflection about diversifying into other currencies, perhaps even in digital, to mitigate growing losses in US dollars.


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