By Stephen Lendman
Source: Stephen Lendman Blog
US dollar dominance finances Washington’s reckless spending, global militarism, its empire of bases, endless wars, corporate takeovers, as well as speculative excess creating bubbles and economic crises – at the expense of democratic freedoms and beneficial social change.
China, Russia and other nations increasingly trading in their own currencies pose a significant threat to dollar dominance. Mahdi Darius Nazemroaya explained Washington’s currency war on China, saying:
“The Chinese are in the process of displacing the monopoly of the US dollar. They are dropping their US Treasury bonds, stockpiling gold reserves, and opening regional distribution banks for their own national currency.”
“This will give them easier access to capital markets and insulate them from financial manipulation by Washington and Wall Street.”
China bashing by public and private US officials is part of a campaign to denigrate its government – making inflammatory accusations without proof about hacking, defying its legitimate right to do what it wishes in its own waters, and threatening sanctions – legal only by Security Council members, never by individual countries against others, Washington’s longstanding weapon against independent governments.
“As the financial architecture of the world is being altered by China and Russia, the US dollar is gradually being neutralized as one of Washington’s weapon of choice,” Nazemroaya explained.
The post-WW II US-dominated international monetary system is threatened with unraveling. Washington is fighting back with propaganda, energy, financial, economic and currency wars against China and Russia, said Nazemroaya.
Russia sold a fifth of its $125 billion in US Treasuries holdings last March. China’s US Treasuries holdings exceed $1 trillion dollars. It’s been aggressively dumping them.
It’s gone from the world’s largest buyer to its biggest seller. Will other countries follow suit? Nations are increasingly trading in their own currencies. Weakening America’s financial strength is the best way curb its imperial ambitions.
Russia drafted legislation aimed at eliminating dollars and euros in trade between Commonwealth of Independent States (CIS) countries: Armenia, Belarus, Kazakhstan, Kyrgyzstan, Tajikistan, Russia, and other former Soviet republics.
A Kremlin statement said “(t)his would help expand the use of national currencies in foreign trade payments and financial services and thus create preconditions for greater liquidity of domestic currency markets.”
It would facilitate regional trade and help achieve economic stability. It would reduce dependency on the world’s two dominant currencies.
China’s central bank launched a Heilongjiang Province yuan/ruble program – Russia’s currency replacing the dollar.
Both countries are increasingly trading in their own currencies – bypassing dollar transactions. If enough other countries follow suit, dollar strength will weaken. Its hegemonic ambitions will be curbed – how much, how soon remains to be seen.
Stephen Lendman lives in Chicago. He can be reached at firstname.lastname@example.org.
His new book as editor and contributor is titled “Flashpoint in Ukraine: US Drive for Hegemony Risks WW III.”
Visit his blog site at sjlendman.blogspot.com.