Thread: BRICS Want To Rely Less On The U.S. Dollar

Personal Liberty Digest
–Daniel Zurbrügg

BRICS Want To Rely Less On The U.S. Dollar

In the past few weeks, I have written several articles about the United States dollar and the driving forces behind the ongoing devaluation of it. After being the world’s main reserve currency for many decades, the game is finally changing, and it has far-reaching consequences for the world and your investment strategy.

In my previous articles, I wrote extensively about the reasons why there is a perfect storm building for the U.S. dollar and in the last few weeks the greenback has been losing further ground against other major currencies. It’s even weakening even against the euro.

We are witnessing the late stage of a U.S. dollar dominated global currency system, a system that is changing quickly. It remains to be seen whether there is going to be a smooth transition to a new global currency regime or an outright collapse of the current system.



In Europe, we are dealing with a currency crisis already and, despite the efforts to cut spending and fix government balance sheets, the bailout packages for countries like Greece and Portugal are causing longer-term damage to the creditability of the euro. Creditability, or better, a lack thereof, is also adding further pressure on the U.S. dollar.

Last week, U.S. Treasury Secretary Timothy Geithner said that a strong currency is and has always been in the interest of the U.S. and that the country will never embrace a strategy to weaken the dollar. At about the same time that Geithner made his statement, the U.S. dollar hit fresh all-time lows against a number of major currencies, a clear indication that the market doesn’t believe him. The lack of creditability and trust in the U.S. fiscal and monetary policy is driving an increasing number of foreign investors away from the dollar and it seems that this process is still in a relatively early stage and could continue for years to come.

This became obvious last month when the leaders of BRICS nations gathered in China for a one day summit. BRICS is an abbreviation for the five countries: Brazil, Russia, India, China and South Africa. They are seen as the dominant emerging markets today and discussions between them are important for various reasons, primarily because these meetings take place without any representation or influence from the U.S. or Europe.

The five BRICS nations make up about 42 percent of world population and almost 20 percent of global gross domestic product and these numbers are growing, making what they discuss very important. To make the numbers look even more impressive we should also say here that these five nations hold more than 40 percent of the world’s currency reserves.

The term “BRICâ€

Related Thread Here
BRICS vs war in Libya

http://www.alipac.us/ftopict-236691-brics.html

We are witnessing the late stage of a U.S. dollar dominated global currency system, a system that is changing quickly. It remains to be seen whether there is going to be a smooth transition to a new global currency regime or an outright collapse of the current system.

When do the citizens of a nation know that there is going to be a change in their currency? History shows the day after the government decides to change the currency.

One day gold was legal tender. The next it was illegal to own gold. After it was confiscated by FDR it was then re-valued at a 75% increase!