THE END OF THE DOLLAR STANDARD | A WARNING FROM PETER SCHIFF

The US dollar has been the world’s primary reserve currency for decades, but that status could be threatened as “very powerful countries” seek to undermine its value, warned Anne Corin of the Institute for Global Security Analysis..

«Main driving forces», such as China, Russia and the European Union have a strong «motivation for de-dollarization», – said Corinne, who is one of the directors of the American think tank on energy and security.

«We do not know what will happen next, but we know that the current situation is unstable.», – said Corinne. – There is a growing club of countries, very powerful countries».

«By far the dollar is regarded as one of the safest investments in the world, and it rises in times of economic or political turmoil..

But one of the factors holding back countries’ enthusiasm for the dollar is the prospect of subjugation to the US when they transact in dollars. When the US dollar is used or transactions are carried out through a US bank, the entities are under US jurisdiction – even if they «have nothing to do with the USA», – Corinne said on CNBC.

Corinne referred to Washington’s unilateral withdrawal from the Iranian nuclear deal in 2018, followed by the restoration of sanctions on Tehran. This situation has left European global companies vulnerable to punishment from Washington if they continue to do business with Iran..

«Europe wants to do business with Iran. She doesn’t want to obey US law to do business with Iran, right? ”Corinne said. – Nobody wants to be picked up at the airport for doing business with countries that the US is not happy with».

World states are abandoning the use of the dollar

As a result, these countries have «very, very strong motivation» stop using the dollar, she said.

«Petro-yuan» may be the first warning. If the dollar weakens, other currencies could replace it in the role that the dollar has traditionally played, especially the Chinese yuan..

In recent years, China has tried to internationalize the use of its currency, the RMB. Such moves have included the introduction of yuan-denominated crude oil futures and reports that China is preparing to pay for imported oil in its own currency rather than in US dollars..

Corinne said that yuan-denominated oil futures, also called «oil yuan», could serve as an early warning signal that the dollar’s dominance is weakening. The expert compared it to a canary in a mine that signals irreversible changes.

However, the expert added that while the petrodollar may be a prerequisite for the international abandonment of the dollar, it is not enough for this process to happen on its own..

World states are abandoning the use of the dollar

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