BRICS to reduce dollar dependence

  • Thread starter Thread starter Bloomberg
  • Start date Start date
“I want to buy from India. Why should I use dollars?” former Nigerian President Olusegun Obasanjo told the gathering to loud cheers from the audience.

“It’s a payment and settlement system that will allow me to buy whatever I want to buy in India, whatever I want to buy in Brazil, without looking for dollars.”
Click to expand...
Because Nigeria, an major oil exporting country will have an issue finding dollars...

The reason the world uses dollars is simple. America imports a huge amount of goods from the rest of the world. If these countries don't want to use dollars, then the easiest thing for them to do would be to shut down their mining and agricultrual industries and move all their manufacturing to the US.
 
konfab said:
Because Nigeria, an major oil exporting country will have an issue finding dollars...

The reason the world uses dollars is simple. America imports a huge amount of goods from the rest of the world. If these countries don't want to use dollars, then the easiest thing for them to do would be to shut down their mining and agricultrual industries and move all their manufacturing to the US.
Click to expand...
Nobody is interested in african pokemon currency. The cost to do business in a local currency is also not insignificant
 
konfab said:
Because Nigeria, an major oil exporting country will have an issue finding dollars...

The reason the world uses dollars is simple. America imports a huge amount of goods from the rest of the world. If these countries don't want to use dollars, then the easiest thing for them to do would be to shut down their mining and agricultrual industries and move all their manufacturing to the US.
Click to expand...
Nope, after WW2, USA entered into an agreement with moat countries to use the dollar as the world reserve currency, the caveat being that they would keep enough gold to back the dollar. Nixon in the 70s removed the gold backing the dollar, thus allowing USA to print money, and export the resulting inflation to other countries forced to trade in the dollar.

The sanctions that USA force over other countries also plays a role as to why people want another reserve currency.
 
jirre so many articles on what will be discussed at the BRICS summit, been getting them for months already, we KNOW

what will be interesting is what has been discussed and agreed
 
Rumour had it that BRICS currency would be gold backed, as I understand not fractionally. Is this still the idea ?
 
"Chinese Minister of Commerce Wang Wentao says the world does not want another cold war.
"It wants a clean and peaceful world. Many emerging markets have become strong after shaking off the yoke of colonialism.""

They really know how to pull out the right words to tickle the ears of the simple and greedy...
 

BRICS to reduce dollar dependence?​


That is something I can get behind. Dollar has far to much of a monopoly.
 
konfab said:
Because Nigeria, an major oil exporting country will have an issue finding dollars...

The reason the world uses dollars is simple. America imports a huge amount of goods from the rest of the world. If these countries don't want to use dollars, then the easiest thing for them to do would be to shut down their mining and agricultrual industries and move all their manufacturing to the US.
Click to expand...
Won't be so easy nor economically viable for them.
Talk about "cutting off your nose to spite your face".
 
Last edited:
etienne_marais said:
Yeah, China with its prosperous cities seems alluring but they still imprison people without trial, have people disappear, burn churches and have internment camps. So much for a clean and peaceful world they want.
Click to expand...
But China as a country has prospered under these rules and even though the citizens protested against communism they are now all benefitting from it
 
Pak Fa Fui said:
But China as a country has prospered under these rules and even though the citizens protested against communism they are now all benefitting from it
Click to expand...
It's not really communism. If they're communist then so are we...
 
rh1 said:
Nope, after WW2, USA entered into an agreement with moat countries to use the dollar as the world reserve currency, the caveat being that they would keep enough gold to back the dollar. Nixon in the 70s removed the gold backing the dollar, thus allowing USA to print money, and export the resulting inflation to other countries forced to trade in the dollar.

The sanctions that USA force over other countries also plays a role as to why people want another reserve currency.
Click to expand...
That caveat was made up by you. History is here:https://www.investopedia.com/articl...-us-dollar-became-worlds-reserve-currency.asp

Summary, after WW2, basically only the US had enough gold to be pegged against gold as it acted as the supplier for most of the world (everyone paid with gold, pound was standard until 3y into war then had to give up as not enough gold left), and the agreement was so everyone could do an adjustable peg of gold to dollar, and they could peg their currencies to US.

It did not mean the US had to stay that way, and pretty much everyone agreed to end it as there is not enough gold in the world for how large the economy is. Nowadays it's because the US:

The Bottom Line​


The reserve status is based largely on the size and strength of the U.S. economy and the dominance of the U.S. financial markets. Despite large deficit spending, trillions of dollars in debt, and the unbridled printing of U.S. dollars, U.S. Treasury securities remain the safest way to store money. The trust and confidence that the world has in the ability of the United States to pay its debts keep the dollar as the most redeemable currency for facilitating world commerce.
Click to expand...
 
Last edited:
Johnatan56 said:
It did not mean the US had to stay that way, and pretty much everyone agreed to end it as there is not enough gold in the world for how large the economy is. Nowadays it's because the US:
Click to expand...
Easy to pay your debts when you hold the reserve currency, you just print money to pay it.

Inflation, what inflation? Hike your rates, everyone flocks to your currency, because guess what - it's the reserve currency and you can get a better return on it.

Awesome, your inflation is now under control while everyone else gets to sit with it.

There's a good reason why it's starting to be questioned, if you can look past any biases. People are tired of being at the mercy of America, where their own economies are impacted through no fault of their own. When there's sufficient trade not being conducted in dollars, the American system collapses under the debt that they now can't repay...
 
You must log in or register to reply here.
Back
Top
Sign up to the MyBroadband newsletter
X