A couple of questions about the dollar

[BitOnyx]

China and Russia won't get rid of US treasure bills. First of all they would need to sell them and it might not be profitable for them. Impact on dollar could be high if China would do that too. Otherwise China would be probably biggest buyer.

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[bobdutica]

Russia and China are strongly pushing against the Dollar, especially with an increasing amount of oil trading going on in Yuan, without USD roundtrips. If anything, the Dollar's user base is sliding.

When the slide picks up speed we are in big trouble.
The SHTF time has been delayed for decades; how much longer can we avoid the pain?

^This

It starts like a snowflake falling on a snowy mountainside, the snow slowly starts to shift, everybody can feel the snow begin to shift but nobody can be sure just how imminent the collapse will be. Suddenly something will snap under pressure; the resistance breaks and the economy collapses in an avalanche...

That's how it will feel; or so I've been told.

I think the avalanche analogy perfectly describes what's coming. I purchased a Zimbabwe 150 Trillion dollar bill for less than $1 US. I want to keep it as a constant reminder of where the USD is heading.

[spazzdla]

USD = toilet paper - look at the inflation since inception. The only thing it has for itself is the petrodollar, dollar backed by oil that is only sellable vs USD. Irak began selling for euros, we know what happened. Lybia wanted to sell for gold, we know what happened. Iran is selling its oil outside of the USD system, we know what's going to happen, unless russia and china stand up.

Hence america's obbsession to stop Iran from becoming nuclear capable.

[practicaldreamer]

I know I am veering slightly off topic here - but to what extent is it in the interests of Russia/China that the US economy does not nosedive ? Is it something to do with China holding $1.4 trillion US debt ?

   Apparently Russia are offloading their US debt - but they hold much less than China. I don't know that China are selling US debt - but they are stocking up on gold.

   Can someone clear this up for me - China could potentially severely weaken the US economy by trading in Remnimbi => dollar losing value. They don't choose to do that (at present).
   They have loaned the US a lot of dollars - is it the case that if they were to sell that debt it would (necessarily) be at a huge loss (almost by definition) - and so if they are to keep it they need confidence that the repayments can be maintained ?

   It wasn't too long ago there was talk of a US default.

Is it that China needs the US as a market for export ?  And if so, is this a price worth paying for China ?

[CurbsideProphet]

Russia is not offloading US debt in the sense that they're selling, they're moving them to offshore accounts in order to try and avoid their assets from getting frozen from sanctions.  And they own something like 1% of treasuries anyway so they're not really significant.  As for China, it's a symbiotic relationship, it's not like China can just dump treasures and come away unscathed. 

[Bit_Happy]

Russia and China are strongly pushing against the Dollar, especially with an increasing amount of oil trading going on in Yuan, without USD roundtrips. If anything, the Dollar's user base is sliding.

When the slide picks up speed we are in big trouble.
The SHTF time has been delayed for decades; how much longer can we avoid the pain?

^This

It starts like a snowflake falling on a snowy mountainside, the snow slowly starts to shift, everybody can feel the snow begin to shift but nobody can be sure just how imminent the collapse will be. Suddenly something will snap under pressure; the resistance breaks and the economy collapses in an avalanche...

That's how it will feel; or so I've been told.

I would love to delay SHTF for at least 30 more years.
Are YOU feeling lucky this decade?

Good comparison with the snowy mountainside avalanche.

[Dr Bloggood]

I know I am veering slightly off topic here - but to what extent is it in the interests of Russia/China that the US economy does not nosedive ? Is it something to do with China holding $1.4 trillion US debt ?

   Apparently Russia are offloading their US debt - but they hold much less than China. I don't know that China are selling US debt - but they are stocking up on gold.

   Can someone clear this up for me - China could potentially severely weaken the US economy by trading in Remnimbi => dollar losing value. They don't choose to do that (at present).
   They have loaned the US a lot of dollars - is it the case that if they were to sell that debt it would (necessarily) be at a huge loss (almost by definition) - and so if they are to keep it they need confidence that the repayments can be maintained ?

   It wasn't too long ago there was talk of a US default.

Is it that China needs the US as a market for export ?  And if so, is this a price worth paying for China ?

This is also in reply to a discussion I had earlier on in this thread:

Many people say China can't afford to sell, they would only shoot themselves in the foot. IMO, China (and Russia) knows their treasuries are worthless in the long run, they won't ever get their money back anyways. So what can they do?

They try to get rid of as much of it as possible in an orderly fashion (hence the selling now), they try to buy gold and infrastructure for the money, because that is what stays after the reset. There is no way they get their money back from the US, but if they blow up the system right now, they won't get ANYTHING back. So they play along with the game and try to save as much as possible, as long as they get their (huge amounts of) gold that's going eastwards every week...

Let's see what happens the moment the west is completely out of physical gold. That moment seems quite close.

In regards to Russia, they only hold a very smart part of US debt, true, but if they dumped all of it, couldn't that cause some panic in the markets and set things in motion? For anybody who says "They would only hurt themselves if they sold", see above, similiar situation as China.

China is on the verge of credit market and real estate collapse, but when all is said and done, let's see who holds the gold...

[zimmah]

Thanks for replies - its interesting times we are living in  

So now it looks like the Russians could be asking for gold and not USD in payment for its gas/oil.

The dollar isn't backed by gold - its backed by the military. But the public appetite for that military intervention is eroding, both in the US itself and in the populations of its "allies" (especially the UK) - as Syria has shown.

Indeed - Putins popularity rating seems to have increased since the Ukraine problems started - whereas Obamas has diminished.

I reckon the renminbi might well (medium term) become the worlds reserve currency. The economic power shift to the east has already occurred - and so the currency war has already been won in many ways. Its all over bar the shouting.


So - the USD drops in value. It impacts massively upon the citizens of the US and the nations that are dependant upon it economically (and there are many  ) - largely because they have been living beyond their means and the chickens are coming home to roost. It doesn't have to be all doom and gloom though - it just means that we will have to cut our cloth accordingly, and there is a dignity in that.

Wouldn't NOW be a good time for the average US citizen to put some usd into either gold, yuan or, preferably, BTC ?

Don't forget silver

[zimmah]

China and Russia won't get rid of US treasure bills. First of all they would need to sell them and it might not be profitable for them. Impact on dollar could be high if China would do that too. Otherwise China would be probably biggest buyer.

it will be profitable to them, because the USA and Europe will be hurt much more, therefore the relative balance will shift towards Russia and China. Also, since China has so much gold, they will come out even stronger.