FREE report to understanding gold’s significance on the global stage can help you determine whether investing in physical gold is right for you.
Read FREE report for more information on:
- De-dollarization - What it is & Why it is Quickly Accelerating
- Petrodollar No Longer Stands, Oil is Trading in Chinese ‘Yaun’
- Global Central Banks Shifting from Dollars to Physical Gold Reserves
- Increased Volatility in U.S. Stock and Bond Markets Due to De-dollarization
De-Dollarization Catapults Gold's Global Paradigm Shift
Understanding gold's significance on the global stage can help you determine whether investing in physical gold is right for you
Why is De-Dollarization America's Greatest Threat?
- Eclipsing the Loss of the Purchasing Power of Your Dollar -
Many Americans, even the poorest among us, enjoy a significantly better life than most of the world. However, many often view their standard of living as the baseline, lacking an understanding of the great financial privileges all Americans have enjoyed since our dollar catapulted to the #1 world reserve currency status after winning World War II.
This perspective is so ingrained because too many generations have passed since the sacrifices of WWII. As a result, younger generations no longer carry the same sense of gratefulness for opportunity and hard work. Instead, this has transformed into a pervasive sense of entitlement, disconnected from the tears, blood, and sweat that every household in America felt and paid for coming out of WWII.
See below the massive benefits the American people view as ‘normal,’ whereas the rest of the world peers in with envy. We will also answer what is de-dollarization and why countries would want not want America to be the world’s most dominant country financially.
American Privilege and the Coming Economic Awakening
As the U.S. dollar continues to gradually lose its dominance as the world’s primary reserve currency, the reality check for Americans will be stark. The privileges we see as everyday entitlements will diminish as well — such as strong stock and bond markets with relatively low volatility, along with lower overall inflation and borrowing costs compared to other countries. We enjoy exceptional trade advantages, financial global dominance, and worldwide monetary policy influence, which provides Americans with relatively stable prices and access to abundant goods and services.
In contrast, other countries, especially developing ones, face much higher volatility in their currencies and markets, inflation, and economic instability. The struggle to secure basic needs is a daily reality for much of the world's population, highlighting the disparity in living standards.
What is De-dollarization?
The global financial landscape is undergoing a seismic transformation as countries increasingly seek alternatives to the U.S. dollar, a process known as de-dollarization. In essence, de-dollarization involves a significant decline in the utilization of U.S. dollars in international trade and financial transactions, leading to reduced demand for the dollar from nations, institutions, and corporations. This shift weakens the dominance and demand of the U.S. dollar in the global capital market, where borrowing and lending activities are currently conducted predominately in dollars.
Since the mid-1940s, countries purchased dollars as a reserve currency because it helped stabilize their economies and currencies from volatility. Additionally, in the early 70s, America made strategic agreements with Saudi Arabia and then the OPEC countries securing an oil trade agreement that all oil must be purchased in dollars. This is also known as “The Petrodollar,” which further cemented the U.S. dollar as the most dominant reserve currency in the world. The de-dollarization trend started in 2001 but formally began when the BRICS nations (Brazil, Russia, India, China, and South Africa) held the BRICS Summit in Russia in 2009 in response to the 08’ financial crisis. The main purpose of this meeting was to discuss how to create a better financial world for their countries and financial independence to create more economic stability.
These countries did not come together to overthrow America and the U.S. dollar because they detested us. Although they envied our powerhouse financial position since WWII, it is often unknown in the U.S. how our economic policies negatively impacted other nations.
Why Do Economic Policies In the U.S. Negatively Affect Other Countries?
The ’08 financial suffering for most Americans was castastrophic. We faced massive job loss that was prolonged and painful. For years, wages dropped like a rock in addition to the benefits companies offered. Many Americans’ 401Ks turned into 201Ks as stock markets dropped 50% from their peak in 2007 to March 2009. Real estate values plummeted by 30-50%. This crisis witnessed the largest bank, insurance company, and business failures in America since the Great Depression. The multi-market plunge into the abyss was so bad that the government halted trading and had to pump printed money into nearly every market in the U.S. to stop the free fall, proving the frailty of the house-of-cards. The government printed staggering amounts of dollars, aka Quantitative Easing (QE) to bail out nearly every bank, many insurance companies, and their chosen businesses deemed ‘Too Big to Fail’.
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