’s central bank now holds a larger proportion of its reserves in euros than in US dollars. Russia has increased its gold reserves by 75% in recent years. China
- The governor of
’s central bank is calling for the abandonment of the dollar as reserve currency, using the International Monetary Fund’s Special Drawing Rights in its place. China Chinaand are considering bypassing the dollar and conducting their mutual trade in their own currencies. Brazil
- Chinese officials [indicated] that neither
nor the entire world has enough spare money to purchase $4 trillion of US Treasuries over the next two years. China
- [Meanwhile] War, bailouts, and stimulus plans have pushed the Obama administration’s annual operating budget 50% into the red.
- Federal Reserve Chairman Bernanke thought he could push down interest rates on Treasuries by purchasing $300 billion of them. However, the result was to cause a sharp drop in Treasury prices and a rise in interest rates.
- Every sector of the
economy is in trouble. US
As monetization of federal debt goes forward, US interest rates will continue to rise, worsening the problems in the real estate sector. The dollar will continue to lose value, making it harder for the
The next shoe to drop will be the dollar’s loss of the reserve currency role.
[Excerpt of a review by Paul Craig Roberts, Assistant Secretary of the Treasury in the Reagan administration]