This could cause insane hyperinflation. A key part of American hegemony is that we print dollars to bribe every country on the planet. This doesn't have any real effects because they all bury the it in a hole in the hope that it will retain it's value better than their own currency.
There are now strong incentives for people with large amounts of Russian trade to start dumping dollars, and once one country does everyone else has to follow suit to avoid getting screwed. This also means people will start calling in US debt. One way around this for the US is to simply delete those digital dollars and not pay any of the debt. There is nothing any country could do about that other than invade to physically take resources as compensation, and good luck with that.
Except, if Europe wants to keep the heat on next winter, guess what they can't do? They can't pay for Russian energy in anything but rubles or gold.
Putin locked in gold at a price below global market value, about $1600/ounce. Why is that important? Because to buy Russian energy you're either going to buy rubles for exchange driving demand thus increasing the value of the ruble or your going to pay more gold for a barrel of Russian crude or NG which essentially increases the value Russian energy. And since some people are going to pay for Russian energy with gold there's going to be two additional effects. 1) Russian energy is going to cost Europe more in gold since Russia considers an ounce to be valued less than international markets giving Russia access to cheap gold. 2) It's going to drive up the price of international gold since demand for it will increase.
Europe can't not buy Russian energy in the mid-term until European countries restructure their energy acquisition, 5 - 10 years.
we had inflation during nixon because of spending on vietnam war and other worthless govt spending, so nixon stopped the bretton woods gold convertibility as other countries wanted their gold back which we didn't have. This won't cause inflation in russia unless they spend too much.
I was talking about dollar inflation as a result of foreign reserve dumping. This is a far worse situation than 1971. The way to avoid it is to nuke the dollar empire(cancel all foreign dollars and debts) for the sake of the domestic economy, which would also require a push towards autarkic reindustrialization. It would be painful, but better than the option of collapsing both the empire and the domestic economy.
it doesn't matter how much gold there is it's all relative, it's just better than fiat based on nothing. You can use dollars to buy gold but the dollars are really IOUs that nations could use to get their gold back from where it was stored, that's what convertibility means here
IMF wanted a new Bretton Woods moment. I think they were aiming for a digital currency, but an actual gold-backed currency is as close as you can get to the actual Bretton Woods (gold-backed USD).
India and China are still transacting with Russia, and the world is too dependent on the region for fuel, fertilizer and food.
The real question is does this bolster or harm the cause of the CBDC?
You could create a CBDC token tied to hard assets like gold or land or other commodities sort of like a blockchain ETF where people trade gold or silver futures today?
Or is Putin doing this because he wants Russia with something solid to base its financial system on that he controls out of the grasp of the central banking cabal that answer to Davos?
Even if it's tied to gold, CBDC has the ability to easily track and regulate (ie. limit where money can be spent, seize money, freeze accounts, set carbon limits). Hopefully enough people see what happened in Canada and with Russia as a reason to never trust a CBDC.
I believe as far back as the Nixon administration someone asked the question what happened if Europe went on a gold standard (the only group of economies which could rival the US at the time) - it could threaten the fiat dollars hegemony. Kissinger scoffed with contempt and said we'll destroy them if they try any such thing. Well I remember someone asking the question around 2014 when it became clear that the gold backed dinar is probably what lead to Gaddafis death and then someone asked the question what are you going to do if Russia or China does the same thing? You can't destroy them without killing a billion people.
The dollar hegemony is destroyed but the US has secured Europe as a permanent vassal now they can't use Russian energy. It renders Europe economically ruined and dependent on US LNG imports they can't really afford.
I'm in the UK - we depend significantly on natural gas for our electricity and heating although we have a more diversified supply from our own gas fields and Norway but we also import some LNG. We've seen sky rocketing energy prices. Someone I work with is seeing his dual fuel monthly bill go from £80 to at least £265. Fuel prices here have averaged around £1.20 a litre for petrol and £1.30 for diesel are now around £1.60 for petrol and £1.75 for diesel. I simply don't know what is going to happen. An awful lot of working people simply can't afford their energy bills anymore and we are more insulated from this than the continent is.
Energy is traded on a global market. The fallout from this will be the death of the western economies. It cannot be sustained.
His mistake was not having nukes.
If you want to tell GAE you're not going to play by their rigged rules, you need nukes, or you're getting toppled.
So like, Iraq?
Iraq didn't have nukes. They were probably trying to get them. It's a damned if you do damned if you don't situation.
nukes are fake and gay, ask Weev
Nukes are fake and gay, yes, but it doesn't matter.
You don't get invaded if you have nukes, simple as that.
Global American Empire
That the acronym reads a homonym for Gay is a happy coincidence.
Globalist American Empire, also known as Globohomo
So yes.
This could cause insane hyperinflation. A key part of American hegemony is that we print dollars to bribe every country on the planet. This doesn't have any real effects because they all bury the it in a hole in the hope that it will retain it's value better than their own currency.
There are now strong incentives for people with large amounts of Russian trade to start dumping dollars, and once one country does everyone else has to follow suit to avoid getting screwed. This also means people will start calling in US debt. One way around this for the US is to simply delete those digital dollars and not pay any of the debt. There is nothing any country could do about that other than invade to physically take resources as compensation, and good luck with that.
This is good analysis.
One factor I'd like to add, for collective consideration:
Petrodollars maintain value primarily because they are used to buy oil, and the west crushes alternatives.
When Russian Golden Rubles start being used to buy/trade oil, That's when shit will hit the fan-- or we will see an actual WW3.
The ruble isn’t worth the electricity that keeps their computers on right now.
Yep. Hence trying to make it a medium for buying gold, the same way the dollar is a medium for buying oil.
It's desperation on Russia's part.
Lol.. Ruble has recovered to 10 rubles of its previous trading tunnel.
You rube go look at the forex.
Wow maybe that’s why they’re creating a gold peg?
Except, if Europe wants to keep the heat on next winter, guess what they can't do? They can't pay for Russian energy in anything but rubles or gold.
Putin locked in gold at a price below global market value, about $1600/ounce. Why is that important? Because to buy Russian energy you're either going to buy rubles for exchange driving demand thus increasing the value of the ruble or your going to pay more gold for a barrel of Russian crude or NG which essentially increases the value Russian energy. And since some people are going to pay for Russian energy with gold there's going to be two additional effects. 1) Russian energy is going to cost Europe more in gold since Russia considers an ounce to be valued less than international markets giving Russia access to cheap gold. 2) It's going to drive up the price of international gold since demand for it will increase.
Europe can't not buy Russian energy in the mid-term until European countries restructure their energy acquisition, 5 - 10 years.
we had inflation during nixon because of spending on vietnam war and other worthless govt spending, so nixon stopped the bretton woods gold convertibility as other countries wanted their gold back which we didn't have. This won't cause inflation in russia unless they spend too much.
I was talking about dollar inflation as a result of foreign reserve dumping. This is a far worse situation than 1971. The way to avoid it is to nuke the dollar empire(cancel all foreign dollars and debts) for the sake of the domestic economy, which would also require a push towards autarkic reindustrialization. It would be painful, but better than the option of collapsing both the empire and the domestic economy.
There was no convertibility to gold since the 1870s. And there simply isn’t enough gold in the world to conduct global trade in any meaningful scale.
it doesn't matter how much gold there is it's all relative, it's just better than fiat based on nothing. You can use dollars to buy gold but the dollars are really IOUs that nations could use to get their gold back from where it was stored, that's what convertibility means here
Russia has been trying everything they can to undermine the US Dollar. If they are serious about TGS it just may work this time.
archive of OP's link: https://archive.ph/rFf34
IMF wanted a new Bretton Woods moment. I think they were aiming for a digital currency, but an actual gold-backed currency is as close as you can get to the actual Bretton Woods (gold-backed USD).
India and China are still transacting with Russia, and the world is too dependent on the region for fuel, fertilizer and food.
The real question is does this bolster or harm the cause of the CBDC?
You could create a CBDC token tied to hard assets like gold or land or other commodities sort of like a blockchain ETF where people trade gold or silver futures today?
Or is Putin doing this because he wants Russia with something solid to base its financial system on that he controls out of the grasp of the central banking cabal that answer to Davos?
Even if it's tied to gold, CBDC has the ability to easily track and regulate (ie. limit where money can be spent, seize money, freeze accounts, set carbon limits). Hopefully enough people see what happened in Canada and with Russia as a reason to never trust a CBDC.
well what Canada did just demonstrates that all bank accounts are unsafe, no matter the currency inside them :(
I think Russia and China and India might create a currency based on a basket of good.
I believe as far back as the Nixon administration someone asked the question what happened if Europe went on a gold standard (the only group of economies which could rival the US at the time) - it could threaten the fiat dollars hegemony. Kissinger scoffed with contempt and said we'll destroy them if they try any such thing. Well I remember someone asking the question around 2014 when it became clear that the gold backed dinar is probably what lead to Gaddafis death and then someone asked the question what are you going to do if Russia or China does the same thing? You can't destroy them without killing a billion people.
The dollar hegemony is destroyed but the US has secured Europe as a permanent vassal now they can't use Russian energy. It renders Europe economically ruined and dependent on US LNG imports they can't really afford.
Good fuck Germany.
I'm in the UK - we depend significantly on natural gas for our electricity and heating although we have a more diversified supply from our own gas fields and Norway but we also import some LNG. We've seen sky rocketing energy prices. Someone I work with is seeing his dual fuel monthly bill go from £80 to at least £265. Fuel prices here have averaged around £1.20 a litre for petrol and £1.30 for diesel are now around £1.60 for petrol and £1.75 for diesel. I simply don't know what is going to happen. An awful lot of working people simply can't afford their energy bills anymore and we are more insulated from this than the continent is.
Energy is traded on a global market. The fallout from this will be the death of the western economies. It cannot be sustained.
It'll be bad as it will hasten the collapse of the Fabian Order by way of breaking the control of the Petrodollar as the world's reserve currency.