The End of the American Empire can now be seen

Historians will one day note that September 24, 2018, was the Beginning of the End of the U.S. Dollar Hegemony.

I've been writing for years about how America's wars and sanctions have been driven Russia and China together, both politically and economically, and how they've been working to create a non-dollar financial system.
Earlier this year, most of the rest of Asia slipped out of the sphere of influence of the American Empire.
Just last month, Europe warned that it was losing patience with U.S. Dollar Hegemony.
Washington either didn't listen or didn't care.

Then this happened.

The European Union said Monday (Sep 24) its members would set up a payment system to allow oil companies and businesses to continue trading with Iran in a bid to evade sanctions after the US withdrew from a nuclear agreement.

Iran and the European Union announced their defiance towards US President Donald Trump's administration after high-level talks at the United Nations among the remaining members of the accord.

The WSJ says this "is a direct rebuke of President Trump’s policy on Iran and his decision to withdraw from the nuclear deal in May."
The details are still being worked out, and it's too late to save Iran from the full weight of our sanctions, but this is no short-term measure. It won't take long before Europe discovers that they can save a lot of money by using their own non-dollar SWIFT system. And they can save a bunch more money by trading in Euros instead of dollars.

Such transactions, presumably in euros and pounds sterling, would not be transparent to American authorities. European companies dealing with the state-owned intermediary technically might not even be in violation of the U.S. sanctions as currently written. The system would be likely be open to Russia and China as well.
Europe would thus provide an infrastructure for legal, secure sanctions-busting — and a guarantee that the transactions would not be reported to American regulators.
It would be pointless to sanction the special purpose vehicle because the U.S. would have no way of knowing who deals with it, and why.
...
No currency’s international dominance has lasted forever, and there’s no reason for the U.S. dollar to be the exception to this rule. Trump’s confidence in his ability to weaponize the dollar against adversaries and stubborn allies alike could eventually backfire for the U.S. as efforts to push the dollar off its pedestal grow ever more serious.

reserve currency status.jpg.png

Share
up
0 users have voted.

Comments

Steven D's picture

at least it happened on my birthday.

up
0 users have voted.

"You can't just leave those who created the problem in charge of the solution."---Tyree Scott

longtalldrink's picture

@Steven D Mine is today. Fellow Libras!

up
0 users have voted.

Well done is better than well said-Ben Franklin

@longtalldrink

up
0 users have voted.
mhagle's picture

@longtalldrink

up
0 users have voted.

Marilyn

"Make dirt, not war." eyo

@Steven D

beneficiary of good things during this year.

up
0 users have voted.
mhagle's picture

@Steven D

up
0 users have voted.

Marilyn

"Make dirt, not war." eyo

Pluto's Republic's picture

Like September 24, 2008 for the Beginning of the End of the U.S. Dollar Hegemony.

Historians will one day note that September 24, 2018, was the Beginning of the End of the U.S. Dollar Hegemony.

But god knows, it depends on the historian and how they want to fame the story. I've seen a short US history that reads in total:

The United States of America:
September 17, 1787 — September 11, 2001

September seems like a troublesome month for the US.

Personally, I marked Operation Enduring Freedom, October 7, 2001, as the point-of-no-return — when the US attacked Afghanistan, the very place where Empires traditionally go to die.

I suppose it could be considered the ultimate October surprise.

up
0 users have voted.

____________________

The political system is what it is because the People are who they are. — Plato

@Pluto's Republic
to the end of an empire.
Did the British Empire end in 1918, 1931, or 1956? It depends on how you look at it.

I certainly would entertain that the American Dollar Hegemony began ending on September 12, 2001. Or September 15, 2008.
But yesterday was at the very least an important landmark.

up
0 users have voted.

end of the US empire?

up
0 users have voted.
Pluto's Republic's picture

@HenryAWallace

...from the forced end to the American Empire. I honestly never have, and I've been writing about how it was going to happen since 2003, when I began trading the Forex. Those dates refer to significant milestones along the way.

up
0 users have voted.

____________________

The political system is what it is because the People are who they are. — Plato
Bollox Ref's picture

Caesar gets laughed at.

up
0 users have voted.

Gëzuar!!
from a reasonably stable genius.

WindDancer13's picture

@Bollox Ref Although my wording was a bit different:

Well, this would certainly give an additional reason why the UN laughed at T's "I am sooo great" speech. (Additional because there were so many other reasons to laugh at it/him.)

up
0 users have voted.

We are what we repeatedly do. Excellence, then, is not an act, but a habit.--Aristotle
If there is no struggle there is no progress.--Frederick Douglass

Pricknick's picture

but I for one welcome it.
Time for the nitty gritty.
Baby are you ready?
[video:https://youtu.be/5xZMQPFN0LY]

up
0 users have voted.

Regardless of the path in life I chose, I realize it's always forward, never straight.

snoopydawg's picture

so why don't they change it and make the country become sane?

up
0 users have voted.

Which AIPAC/MIC/pharma/bank bought politician are you going to vote for? Don’t be surprised when nothing changes.

Pricknick's picture

@snoopydawg
Damned good I wasn't taking a drink when I read what you just posted.
You're an ass snoop. Where the hell is the s/.
Thanks.

up
0 users have voted.

Regardless of the path in life I chose, I realize it's always forward, never straight.

China stops talking

The Chinese government denied a U.S. Navy ship permission for a port visit to Hong Kong in October, U.S. military officials said, a decision issued as Beijing also canceled a high-level naval meeting in the U.S.

More China

On Monday, the US began taxing $200 billion in imports from China, the biggest round of tariffs to take effect in the trade conflict. The US also approved a $330 million arms sale to Taiwan, an island nation China claims sovereignty over whose ties with the US have long concerned Beijing.

Just last week, Washington ordered Chinese state media to register as foreign agents and slapped sanctions on the Chinese military for buying weapons equipment from Russia. And over the summer, the US barred China from participating in the biennial Pacific Rim military exercises.

Syria

Russia announced on Monday it would send its advanced S-300 missile defense systems to Syria after it lost a spy plane to errant Syrian air defense fire— but the new set-up puts Israel at high risk of killing Russians and starting a war.

Russia blames Israel for Syria, its own ally, firing a Russian-made air defense missile that missed Israeli jets attacking Syria and instead killed 15 Russian servicemen on an Il-20 spy plane.

up
0 users have voted.
Pricknick's picture

@gjohnsit

up
0 users have voted.

Regardless of the path in life I chose, I realize it's always forward, never straight.

Couldn't have happened to a nicer empire.

up
0 users have voted.

The earth is a multibillion-year-old sphere.
The Nazis killed millions of Jews.
On 9/11/01 a Boeing 757 (AA77) flew into the Pentagon.
AGCC is happening.
If you cannot accept these facts, I cannot fake an interest in any of your opinions.

@UntimelyRippd Then India can take over. It feels exciting at first, but then the responsibilities of running an empire bog you down, like Snoopy when he took over (briefly) as Head Beagle.

"I made one hundred fifty-six decisions today. All of them wrong."

up
0 users have voted.

If a nation has a major trade deficit the natural course of action is that the currency of that nation should be devalued. That makes exports cheaper and imports more expensive, restoring trade balance. That creates inflation and a reduction of the standard of living of that nation and exports more of its output. This is what happens if international trade system works properly. It doesn't happen because the US dollar is the universal trade currency, and that is a massive subsidy for the US. Furthermore, this trade imbalance forces other countries to hold US dollars, buy US debt and invest in US assets, because the US cannot ship overpriced US goods to the rest of the world. Trump and his wacko economic advisers are exactly wrong. The world is not being unfair to the poor USA, it's exactly the opposite. There is no resolution to the US trade problem, because the Dollar is the standard. Perversely, if the world economy gets into trouble, investors turn to the Dollar, driving up the value of the Dollar and compounding the trade imbalance.

Here's an interesting observation that completely debunks Trump's logic- The US consumer buys imported goods when having a choice at the shopping center, the car dealer or the appliance shop. And even when he buys American, the parts and assemblies come from abroad. If the US consumer will not buy US goods then how can we expect consumers from other countries to buy US goods?

I completely agree with gjohnsit, The world has had it with subsidizing "the greatest nation on Earth". I expect that the world will take a few years to sort this out, but in the end the US Dollar will not be the standard for trade and the US economy will take a significant hit. China is the country to watch as it has had the greatest volume of world wide trade for many years, I think since around 2010. China's reaction to Trump will be full-on outrage, unlike Russia's Putin who is far more moderate and still fantasizes that he can be a good partner with the US.

up
0 users have voted.

Capitalism has always been the rule of the people by the oligarchs. You only have two choices, eliminate them or restrict their power.

The Aspie Corner's picture

up
0 users have voted.

Modern education is little more than toeing the line for the capitalist pigs.

Guerrilla Liberalism won't liberate the US or the world from the iron fist of capital.

less and less "Exceptional."

BTW, hearing Obama claim this country is Exceptional told me more about Obama than I cared to know. Same when he claimed that soldiers returning from Vietnam had been spat upon.

up
0 users have voted.

@HenryAWallace Jim Jeffries did a skit where he proposed a new national anthem with a title like, "America. We're not the best, but at least we're not the worst." (Actually, I think it went more like, "America. Another Country in the List of Countries.")

up
0 users have voted.

@SancheLlewellyn

claim it (and the only politician whose claiming it told me more about Obama than I wanted to know). You see, I was a huge Obama supporter in 2008, in both effort and $$, yet he was the also the one who caused me to stop voting Democratic, starting with the 2010 midterms. So, as disappointing politicians go, his disappointing comments struck me harder than others.

up
0 users have voted.