Russia threatens to dump the dollar

[Bumble_Bee_Tuna]

If the US pursues sanctions, Russia threatens to dump US dollar.

Will China follow suit?

The British response in the Telegraph is here. This seems to scoff at the idea as unrealistic for the following reason: it opines that such a realization will only occur if and when China surpasses the US as the largest economy (which isn't too far off).

But why couldn't this accelerate the situation? China has already been establishing bilateral deals across the world bypassing dollars, and I believe Russia has as well.

 

[Kevin Rudd]

How does the US intend to pursue sanctions? Through the UN security council where every permanent member including Russia has veto power?

China's largest trading partner is the US, highly unlikely they would fuck that relationship for Russia imo.

 

[Darkballs]

This seems to scoff at the idea as unrealistic for the following reason: it opines that such a realization will only occur if and when China surpasses the US as the largest economy (which isn't too far off).

Until the Chinese open up to more international scrutiny, the yuan will never replace the dollar. Foreign investors are not about to stake their claim on a currency that lacks transparency.

Russia "dropping the dollar" would hurt Russia, and would not effect U.S. currency at all.

 

[Kevin Rudd]

Until the Chinese open up to more international scrutiny, the yuan will never replace the dollar. Foreign investors are not about to stake their claim on a currency that lacks transparency.

Russia "dropping the dollar" would hurt Russia, and would not effect U.S. currency at all.

Correct. Given the fact that the Yuan is not even a floated currency and is pegged to the US dollar, what would they do once they dropped the dollar? Float it? Peg it to Rubles?

 

[ncordless]

Ha! That's funny.

IF they did, which would require overriding the opinion of any Russian with a brain, it would only serve to further isolate them from the global economy.


As far as sanctions, from what I understand the sanctions will be targeted at the upper crust of Russia, especially those with ties to the Putin regime. Things like not being able to travel to US or EU (including kids for college), freezing all their assets, etc.

 

[GhostZ06]

If the US pursues sanctions, Russia threatens to dump US dollar.

Will China follow suit?

The British response in the Telegraph is here. This seems to scoff at the idea as unrealistic for the following reason: it opines that such a realization will only occur if and when China surpasses the US as the largest economy (which isn't too far off).

But why couldn't this accelerate the situation? China has already been establishing bilateral deals across the world bypassing dollars, and I believe Russia has as well.

ahahah an do what? they're hurt themselves more then us

 

[HIMBOB]

My colleague keeps talking about this and tells me to read a book called "The Currency Wars", apparently some CIA think tank proposed this idea as a way for Russia to undermine the US's power.


In my opinion is would hurt the states, but not as much as it would hurt Russia.

 

[Bumble_Bee_Tuna]

While this is all interesting, none of us are in any position to determine what will or will not transpire and certainly who will be hurt in the long run. All we can do is speculate at this point and see how the events play out. I, for one, fear such a move, if true, as it would immediately escalate the military stand off.

 

[__Big_D__]

ahahah an do what? they're hurt themselves more then us

Thought this story was fake?

 

[therealdope]

Until the Chinese open up to more international scrutiny, the yuan will never replace the dollar. Foreign investors are not about to stake their claim on a currency that lacks transparency.

That's a safe bet because AFAIK, you can't even take Chinese currency outside of China. When you leave, you are asked to turn in all of your Yuan and you get USD back.

Maybe that has changed since I was last in China.

 

[ZroC]

While this is all interesting, none of us are in any position to determine what will or will not transpire and certainly who will be hurt in the long run. All we can do is speculate at this point and see how the events play out. I, for one, fear such a move, if true, as it would immediately escalate the military stand off.

Most of these threads just include people saying stuff like "HA yeah right we'd kill them" or "they'd only hurt themselves." The reality is the US seems to be worried enough about these actions to go around taking out dissident countries. All the countries threatening to drop the dollar have been targeted in some way by the US. That's not a coincidence. Now that the idea to drop is gaining more and more ground with these countries the US is going into over drive trying to stop them. The USA's own actions tell us everything.

 

[HOLA]

Most of these threads just include people saying stuff like "HA yeah right we'd kill them" or "they'd only hurt themselves." The reality is the US seems to be worried enough about these actions to go around taking out dissident countries. All the countries threatening to drop the dollar have been targeted in some way by the US. That's not a coincidence. Now that the idea to drop is gaining more and more ground with these countries the US is going into over drive trying to stop them.

In reality, none of that is happening.

 

[Orgasmo]

China's currency is pegged to the US dollar, which means their money loses value if US dollar goes down. They want the US dollar to stay high, so the money they lent won't go down the drain. Also, China's trade volume with US is many times bigger than the one they have with Russia. If push comes to shove, China will bail on Russia.

 

[NelmarksGhost]

The potential economic maneuvers resulting from this crisis are scary. I think it's where the biggest global effects will be seen. Also frightening is no one can predict what's going to happen.

 

[Bumble_Bee_Tuna]

Most of these threads just include people saying stuff like "HA yeah right we'd kill them" or "they'd only hurt themselves." The reality is the US seems to be worried enough about these actions to go around taking out dissident countries. All the countries threatening to drop the dollar have been targeted in some way by the US. That's not a coincidence. Now that the idea to drop is gaining more and more ground with these countries the US is going into over drive trying to stop them. The USA's own actions tell us everything.

There is some truth to this as there were reports that both Saddam and Libya threatened to manage their trades moving away from dollars. Not to simplify the situation (as there were other reasons for the US invasion of Iraq, such as Israel's influence), but the petrodollar is also a strong concurrent reason. Many of the geopolitical maneuvers overlap and are interconnected in many textures.

 

[ZroC]

In reality, none of that is happening.

None of it? So countries aren't threatening to drop the dollar? So said countries aren't being immediately attacked or threatened there after? Define none because some of it is definitely happening. China and Russia have been hinting they would drop the dollar for a while now. It's not like this is coming out of nowhere.

 

[Bumble_Bee_Tuna]

China's currency is pegged to the US dollar, which means their money loses value if US dollar goes down. They want the US dollar to stay high, so the money they lent won't go down the drain. Also, China's trade volume with US is many times bigger than the one they have with Russia. If push comes to shove, China will bail on Russia.

You don't know that, and quite frankly, none of us know how this will play out. Speculation is fun on this end, but we are not aware of what contingencies China is prepared for. In September of last year, there were reports that China's yuan is one of the most traded currencies in the world. Then in December we hear it is the 2nd most traded currency. Indeed, during the "shut down" China called for a "de-Americanization" of the world. China and Russia also have a bilateral agreement bypassing the dollar and China has established a similar agreement with France and UK.

An interesting piece to read are: 9 Signs that China is Making a Move on the US Dollar and 5 Signs that China is Taking Over the Earth. Food for thought.

 

[Jukai]

China is definitely making a move on the dollar but Russia dumping our currency would IMMENSELY hurt China because their currency is STILL pegged to our dollar.

China and Russia aren't exactly friend. The Chinese are not happy about the Ukraine situation.

The more I read about this, the more I find this all an empty threat. They are going to refuse to pay off any loans to US Banks? Does Glazyev realize he's literally threatening to default and get downgraded by every finance industry on the planet? How does this help Russia?

 

[Marsupial]

How does the US intend to pursue sanctions?

Expansion and enforcement of the Magnitsky Act rather than UNSCR type sanctions, perhaps.

 

[ZroC]

Actually the title is a bit off, this is just the personal opinion of one man who works for Putin, not the official stance Russia is taking. If he still has his job by tomorrow we'll know if he's backed by Putin or not.