The US military power is weakening and the consequences of this process are quite remarkable. In a world full of conflicts caused by Washington, the economic and financial evolution of many countries is an expected and predictable development of the situation, says the daily VestiFinance.
The important role of the dollar in the world economy is due to three main factors: the petrodollar, the dollar as a world reserve currency and Nixon's decision in 1971 not to convert the dollar into gold.
Dollar-petrodollar-gold
The greatest geoeconomic changes in the last fifty years occurred in 1973 after the conclusion of the agreement between OPEC, Saudi Arabia and the US on the sale of oil exclusively in dollars. Billions of dollars were transferred in US Treasury bonds and other financial resources. In return, Saudi Arabia and other OPEC countries received US military protection.
The second factor, perhaps even more important for the world economy, according to the average, is that the dollar became the world reserve currency. The role of the dollar, obviously associated with the petrodollar trade, has almost always had its dominant share of more than 40% of the basket of SDRs - special drawing rights -, while the euro has maintained a stable share of 29-37 % since 2001. To understand the current economic changes, it is enough to remember that the yuan is being used more and more in the global trade of SDRs with an initial quota of 10%.
A few years ago, almost all countries used the US dollar to trade with each other, even though they were countries opposed to the US and their imperialist policies, since the payment method required the use of dollars, the paper recalls.
"This continued use of the dollar had a devastating impact on the planet, and the US got the opportunity to print sheets of paper without the support of the gold value, and then exchange them for real goods," he adds.
According to the media, the destabilizing factor for the world economy is Washington's ability to accumulate huge public debts without worrying about the consequences for international markets.
"The United States created the conditions for a new financial bubble that could ruin the entire global economy when it explodes," the paper warns.
Dollars and war: the end of the era?
The decisive factor, which has changed the focus of countries such as China and Russia, was the financial crisis of 2008, as well as the increase of the US aggression in Yugoslavia in 1999, says the media. The Iraq war, along with other factors, prevented Saddam Hussein from starting to market the oil in euros, which threatened the financial hegemony of the dollar in the Middle East.
A few decades ago, any idea of moving away from petrodollars was perceived as a direct threat to the US world hegemony that required a military response. In 2017, given the decline in confidence in the United States as a result of multiple failed attempts to subjugate, undermine and control other small countries, the general decline of the dollar system began, the author points out.
The second factor, perhaps even more important for the world economy, according to the average, is that the dollar became the world reserve currency. The role of the dollar, obviously associated with the petrodollar trade, has almost always had its dominant share of more than 40% of the basket of SDRs - special drawing rights -, while the euro has maintained a stable share of 29-37 % since 2001. To understand the current economic changes, it is enough to remember that the yuan is being used more and more in the global trade of SDRs with an initial quota of 10%.
A few years ago, almost all countries used the US dollar to trade with each other, even though they were countries opposed to the US and their imperialist policies, since the payment method required the use of dollars, the paper recalls.
"This continued use of the dollar had a devastating impact on the planet, and the US got the opportunity to print sheets of paper without the support of the gold value, and then exchange them for real goods," he adds.
According to the media, the destabilizing factor for the world economy is Washington's ability to accumulate huge public debts without worrying about the consequences for international markets.
"The United States created the conditions for a new financial bubble that could ruin the entire global economy when it explodes," the paper warns.
Dollars and war: the end of the era?
The decisive factor, which has changed the focus of countries such as China and Russia, was the financial crisis of 2008, as well as the increase of the US aggression in Yugoslavia in 1999, says the media. The Iraq war, along with other factors, prevented Saddam Hussein from starting to market the oil in euros, which threatened the financial hegemony of the dollar in the Middle East.
A few decades ago, any idea of moving away from petrodollars was perceived as a direct threat to the US world hegemony that required a military response. In 2017, given the decline in confidence in the United States as a result of multiple failed attempts to subjugate, undermine and control other small countries, the general decline of the dollar system began, the author points out.
In recent years, many countries, which oppose Washington, have realized that the only way to adequately restrict the consequences of the fall of the US empire is to gradually abandon the dollar. This serves to limit Washington's capabilities for military spending by creating alternative tools in the economic and financial spheres that would help end Washington's domination. What is also important for the Russian-Chinese-Iranian strategy of uniting Eurasia and, therefore, reducing the US role.
"The US shot up in the foot to accelerate this process with the exclusion of Iran from the SWIFT system and open the way for the Chinese alternative CIPS, as well as by applying sanctions against Russia, Iran and Venezuela, which also boosted the extraction and acquisition of gold on the part of China and Russia ", analyzes the medium.
De-dollarization
"The US shot up in the foot to accelerate this process with the exclusion of Iran from the SWIFT system and open the way for the Chinese alternative CIPS, as well as by applying sanctions against Russia, Iran and Venezuela, which also boosted the extraction and acquisition of gold on the part of China and Russia ", analyzes the medium.
De-dollarization
Beijing began to exert strong pressure on Riyadh in order to force it to accept payments for oil in yuan instead of dollars. Saudi Arabia is in a difficult situation associated with the maintenance of the US dollar linked to oil, although its main ally, the United States, has implemented a controversial strategy in the Middle East.
China became Saudi Arabia's biggest customer, and given the agreements with Nigeria and Russia, Beijing can quietly stop buying Riyadh oil if it continues to insist on payments exclusively in dollars. This would severely damage the petrodollar, a vicious system, harmful to China and Russia, the paper said.
"De-dollarization has become a strategic priority for Beijing, Moscow and Tehran, and eliminating the unlimited influence of the Fed and the US economy means limiting the expansion of the US imperialists and reducing global destabilization," the article stresses.
More and more countries are beginning to see the advantages of a decentralized system, in contrast to the US dollar system.
Iran and India, as well as Iran and Russia, often sell hydrocarbons in exchange for raw material products, thus avoiding US sanctions.
In addition, China's economic strength allowed it to allocate a 10 billion euro loan to Iran, which allowed it to dodge the recent sanctions, the paper recalls.
Venezuela, which has the largest oil reserves in the world, has just started a historic movement towards a total refusal to sell oil in dollars.
Beijing plans to buy gas and oil from Russia by paying with yuan, and Moscow will immediately convert the yuan into gold on Shanghai's international energy exchange.
"This 'gas-yuan-gold' mechanism represents revolutionary economic changes due to the gradual abandonment of the dollar in trade," the article concludes.
China became Saudi Arabia's biggest customer, and given the agreements with Nigeria and Russia, Beijing can quietly stop buying Riyadh oil if it continues to insist on payments exclusively in dollars. This would severely damage the petrodollar, a vicious system, harmful to China and Russia, the paper said.
"De-dollarization has become a strategic priority for Beijing, Moscow and Tehran, and eliminating the unlimited influence of the Fed and the US economy means limiting the expansion of the US imperialists and reducing global destabilization," the article stresses.
More and more countries are beginning to see the advantages of a decentralized system, in contrast to the US dollar system.
Iran and India, as well as Iran and Russia, often sell hydrocarbons in exchange for raw material products, thus avoiding US sanctions.
In addition, China's economic strength allowed it to allocate a 10 billion euro loan to Iran, which allowed it to dodge the recent sanctions, the paper recalls.
Venezuela, which has the largest oil reserves in the world, has just started a historic movement towards a total refusal to sell oil in dollars.
Beijing plans to buy gas and oil from Russia by paying with yuan, and Moscow will immediately convert the yuan into gold on Shanghai's international energy exchange.
"This 'gas-yuan-gold' mechanism represents revolutionary economic changes due to the gradual abandonment of the dollar in trade," the article concludes.
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