Ditch the Dollar

[Iroh]

Is it the beginning of some kind of cold war led by China? The primary purpose of these bilateral trades isn't only to cut costs in my opinion, and China probably is doing its best to lessen the dominance of the US dollar over the world economy by initiating these trades with different nations, they know that other countries will follow suit knowing they can do it to reduce costs and to become a bit more independent when it comes to using a currency for international trade.

I wonder how will things be if USD isn't the leading currency of the world and isn't used for the pricing of almost everything that you see or buy locally or internationally either through the internet or in real life.

I immediately thought that China may have something up its sleeve when I read the OP and when I had read your post, I agreed with your opinions. The US and China are not friends and some would say there is some rivalry in their relationship.

China may very well be leading some sort of silent boycott against the USD when it comes to international trade. I also think China is obviously trying to weaken and undermine the dollar in international trade and it seems to be working as what country wouldn’t jump at the opportunity of doing business with China or anyone else and paying not in the USD but in your local currency? I wouldn’t fault any country if it bites.

In having multiple trading partners where the USD won’t be used for payment for trade, China could be steadily and slowly trying to take away the relevance of the dollar from the international market. If that ever happens, we should be watchful on what currency would try to step in and replace the dollar as the leading currency in the world stage.

[woez]

Fans of populism, of course, "clap their hands", rejoicing. True, they do not understand that in fact, the situation is diametrically opposite ...

It seems that politicians often preach one thing but do another when it comes to their personal finances. While they may publicly denounce the US dollar and western influence, they continue to take advantage of the benefits and stability of those systems in their own lives. This highlights the disconnect between political rhetoric and personal action.

China may very well be leading some sort of silent boycott against the USD when it comes to international trade. I also think China is obviously trying to weaken and undermine the dollar in international trade and it seems to be working as what country wouldn’t jump at the opportunity of doing business with China or anyone else and paying not in the USD but in your local currency? I wouldn’t fault any country if it bites.

I think this also this another point A lack of trust and stability in the global financial system could lead to increased volatility and economic uncertainty. It's not surprising that China, as a rising global economic power, would seek to lessen its dependence on the US dollar in international trade. However, it's important to consider the potential consequences of a shift away from the USD as the dominant currency.

[LogitechMouse]

And Pakistan is also hopping on the yuan train? Wow, this is getting ridiculous. What's next, Zimbabwe trading in their own worthless currency? Oh wait, they already did that.

I'm sorry, but this move by China and its partners just seems like a big middle finger to the US. But hey, if they want to risk their own economies and stability for a political statement, who am I to judge?

Pakistan followed by Saudi Arabia, and Iran. They're the countries that choose to follow the BRICS, and choose to use another currency for their transactions which is the Chinese Yuan.

USD has been the world's reserve currency for over a century already and on average, it lasted an average of 96 years for the 2 past world reserve currency before they are being replaced which means that the USD surpassed the average already. Will it be replaced? I don't think so for a short amount of time, but de-dollarization will happen, but it will take a very long time for it to happen. Right now, there are no signs that BRICS are slowing down the process, and they are always moving forward to achieving their goal. Expect more and more news regarding BRICS, and their plans of ditching the dollar.

TBH, I don't if it's only me, but I want to see our world reserve currency getting changed when I'm still alive. I mean I already experienced a pandemic which happened only twice in my whole life (SARS and COVID pandemic), and now I also saw USD getting replaced.

[STT]

Its probably the Dollar itself which will end the dollar, these agreements I wonder why are they new why wasnt it always like that.   Brazil and China arent some perfect stability in their own currency standards so the idea they can perfectly align is probably not the case.   There has been previous attempts to align countries in trade and other ways, many times its been attempted and things drift and the alliance unfortunately tends not to hold because the two or more countries are different and not gaining enough in their agreement.
 Its harder then it looks but in theory its a good idea to have a trade route to best promote comparative advantage, it just cant be false in any way or it doesn't last.  Most of the time adjustments and flexibility are required to stop one party being disadvantaged

[Darker45]

And Pakistan is also hopping on the yuan train? Wow, this is getting ridiculous. What's next, Zimbabwe trading in their own worthless currency? Oh wait, they already did that.

I'm sorry, but this move by China and its partners just seems like a big middle finger to the US. But hey, if they want to risk their own economies and stability for a political statement, who am I to judge?

Pakistan followed by Saudi Arabia, and Iran. They're the countries that choose to follow the BRICS, and choose to use another currency for their transactions which is the Chinese Yuan.

USD has been the world's reserve currency for over a century already and on average, it lasted an average of 96 years for the 2 past world reserve currency before they are being replaced which means that the USD surpassed the average already. Will it be replaced? I don't think so for a short amount of time, but de-dollarization will happen, but it will take a very long time for it to happen. Right now, there are no signs that BRICS are slowing down the process, and they are always moving forward to achieving their goal. Expect more and more news regarding BRICS, and their plans of ditching the dollar.

Has the US dollar been acting as the world's reserve currency for over a century already? Isn't it that its status as the world's reserve currency was agreed upon under the Bretton Woods System? The Bretton Woods Agreement which made the US dollar the globe's reserve currency was entered into in 1944. If this is the case, then its status as a reserve currency is only 79 years old, and it seems it is already weakening.

[karmamiu]

Its probably the Dollar itself which will end the dollar, these agreements I wonder why are they new why wasnt it always like that.   Brazil and China arent some perfect stability in their own currency standards so the idea they can perfectly align is probably not the case.   There has been previous attempts to align countries in trade and other ways, many times its been attempted and things drift and the alliance unfortunately tends not to hold because the two or more countries are different and not gaining enough in their agreement.
 Its harder then it looks but in theory its a good idea to have a trade route to best promote comparative advantage, it just cant be false in any way or it doesn't last.  Most of the time adjustments and flexibility are required to stop one party being disadvantaged

When it comes to agreements it is just like they are publicly shaking their hands while secretly stomping each other's foot. Although dollar has been weakening every year, it is unlikely that it will be replaced by another currency in the next few years but still nothing is certain. China has always put its best foot forward in order to be the next reserved currency, but I don't think the situation goes into their favor since there are also countries who are waiting for the downfall of dollar.

[bittraffic]

Its probably the Dollar itself which will end the dollar, these agreements I wonder why are they new why wasnt it always like that.   Brazil and China arent some perfect stability in their own currency standards so the idea they can perfectly align is probably not the case.   There has been previous attempts to align countries in trade and other ways, many times its been attempted and things drift and the alliance unfortunately tends not to hold because the two or more countries are different and not gaining enough in their agreement.
 Its harder then it looks but in theory its a good idea to have a trade route to best promote comparative advantage, it just cant be false in any way or it doesn't last.  Most of the time adjustments and flexibility are required to stop one party being disadvantaged

When it comes to agreements it is just like they are publicly shaking their hands while secretly stomping each other's foot. Although dollar has been weakening every year, it is unlikely that it will be replaced by another currency in the next few years but still nothing is certain. China has always put its best foot forward in order to be the next reserved currency, but I don't think the situation goes into their favor since there are also countries who are waiting for the downfall of dollar.

They are using their own currency to trade according to the articles. If China buys oil from Russia, means China will need to use rubles to make transactions. Same with Brazil as any country trades with Brazil they will need to use Brazil Real, that's how I understood it as they wanna bypass using the US Dollar.

There are a few countries that might just use Yuan though especially since their currency is not good to hold. More and more countries will seem to be joining even Japan buys oil from Russia.

[Wind_FURY]

The political undertone with the ditching of the Dollar are very clear and one of the reasons why the BRICS countries are strengthening relations to rely less on the US Dollar and more on trading in other currencies.

China seems to be the leader of the pack and the driving force behind this, because they know that a weaker Dollar will give them a economical advantage and also a stronger military power, if they can strengthen their economy. 

Actually, with China, because they're an export-driven country, they want the Yuan to be weaker than the U.S. Dollar because it would make their exports more attractive for the importers, and who is the biggest importer of Chinese manufactured-products? The United States, and most of the other top importers of Chinese products also deal in Dollars.

https://www.worldstopexports.com/chinas-top-import-partners/

I believe China is also the largest holder of the U.S. Dollar in their foreign reserves.

[virasog]

I think these trade agreement between these nations have some political undertone. It is clear that China is leading an economic war to whittle down the financial influence of the United States. I support the idea of using local currency for international trade because it helps to reduce the cost of such transactions and also eradicate the influence the dollar has over these economies. I am pained by the amount most developing nations have to spend on international trade because of the dominance of some currencies. These expenses would have been used to provide basic amenities for these poor nations. But these policies should be done with good intentions and not just to score political points.

The dollar has been the mainstream currency for all countries if they want to trade with each other. Due to this reason, every country kept the dollar reserve with them, and the more the country have dollars with them in reserve, the richer they were considered.
Also, the US knew this fact, and they kept on printing money which did not make the dollar value too low, although inflation does increase when you print more dollars.

However, now when countries are using other currencies, this means that demand for the dollar will decrease considerably globally, and their currency value will be devalued. The world economic system is changing rapidly.

[tread93]

I feel like its literally US against the world right now. I think most countries are sick and tired of the FED creating money out of thin air. The problem is that every country is so intertwined with the USD that it would take years to fully decouple, but its clear that this process has been jump started and that eventually the fall of the USD is inevitable, at least to be replaced as the world reserve without question. Although we always knew that this day was coming, just not quite so soon...... Good thing we are all acquainted wth BTC

[bittraffic]

I feel like its literally US against the world right now. I think most countries are sick and tired of the FED creating money out of thin air. The problem is that every country is so intertwined with the USD that it would take years to fully decouple, but its clear that this process has been jump started and that eventually the fall of the USD is inevitable, at least to be replaced as the world reserve without question. Although we always knew that this day was coming, just not quite so soon...... Good thing we are all acquainted wth BTC

It's interesting to see though that the media had not suppressed the news about this de-dollarization. It's like they wanted the world to know which is quite not normal. In the news just recently France bought LNG using the Chinese Yuan. It's like they literally want this to happen or everyone even the media is ganging up.

BTC I think will be much better to be the global currency since everyone is going to be suspicious also when could it happen that CCP uses the Yuan for political purposes.

[robattfield]

Many factors can affect the value of $ in the international market such as the monetary policies of countries, the global economic situation, market fluctuations and important political events. But I must admit since the outbreak of the epidemic, I see that the political position of the US and EU countries is gradually losing their voice, the rise of China and India in recent years has brought a new polarization of the economy. We face many other concerns in our lives now, and I think without a more positive change the shift in economic development will gradually shift to Asia, and my speculation about jobs in some Asian countries will require workers from the US and EU.

[DrBeer]

Is it the beginning of some kind of cold war led by China? The primary purpose of these bilateral trades isn't only to cut costs in my opinion, and China probably is doing its best to lessen the dominance of the US dollar over the world economy by initiating these trades with different nations, they know that other countries will follow suit knowing they can do it to reduce costs and to become a bit more independent when it comes to using a currency for international trade.

I wonder how will things be if USD isn't the leading currency of the world and isn't used for the pricing of almost everything that you see or buy locally or internationally either through the internet or in real life.

I immediately thought that China may have something up its sleeve when I read the OP and when I had read your post, I agreed with your opinions. The US and China are not friends and some would say there is some rivalry in their relationship.

China may very well be leading some sort of silent boycott against the USD when it comes to international trade. I also think China is obviously trying to weaken and undermine the dollar in international trade and it seems to be working as what country wouldn’t jump at the opportunity of doing business with China or anyone else and paying not in the USD but in your local currency? I wouldn’t fault any country if it bites.

In having multiple trading partners where the USD won’t be used for payment for trade, China could be steadily and slowly trying to take away the relevance of the dollar from the international market. If that ever happens, we should be watchful on what currency would try to step in and replace the dollar as the leading currency in the world stage.

China and the United States are not friends and it is unlikely that they will ever become. They are ideological opponents, that's a fact. BUT !
I recommend studying the structure of the Chinese economy, and you will understand that although the USA and China are not friends, they are forced symbiotics!
The causes of symbiosis are very broad.
For example, it is unprofitable for the United States to produce cheap goods within the country, more precisely at the price of Chinese ones - due to higher wages and taxes, it is impossible to produce them in the USA. And the population is already accustomed to "penny" small things for life.
On the other hand, China is the largest consumer of technology from the US, and the US is profitable because China is absolutely dependent on them, and will constantly pay.
Symbiosis is beneficial to China in that it has a huge and rich market! Look at the US share of China's exports!! All the rest combined do not consume so much in monetary terms! We have already talked about technologies - such technologies will not be supplied to China by India, for example, or Brazil! Pr rogue countries, such as Russia and Iran, it makes no sense to talk at all ...
From the point of view of politics - yes, China is the "opposite political pole", but this pole has a high influence in regions where the US is weak, and the US does not need to spend efforts to restore order or change the situation - Xi himself will do everything so that the US does not worry .. Because - SANCTIONS, which China is very afraid of.

Therefore, all this hysteria with "give up the dollar" is just a beautiful game of China, with its "not intelligent servants", but no world conspiracy

[Wind_FURY]

--Snip--

Therefore, all this hysteria with "give up the dollar" is just a beautiful game of China, with its "not intelligent servants", but no world conspiracy

Another reason why no country is going to truly "ditch the Dollar" is because no young, and able citizen from around the world are in a hurry in applying to be Chinese residents to earn their salaries in Yuan. Everyone wants to earn in the U.S. Dollar simply because it's ahead than any other currency in? Spendability, Saveability, and Liquidity.

 

[sana54210]

The dollar has been the mainstream currency for all countries if they want to trade with each other. Due to this reason, every country kept the dollar reserve with them, and the more the country have dollars with them in reserve, the richer they were considered.
Also, the US knew this fact, and they kept on printing money which did not make the dollar value too low, although inflation does increase when you print more dollars.

However, now when countries are using other currencies, this means that demand for the dollar will decrease considerably globally, and their currency value will be devalued. The world economic system is changing rapidly.

I think the fact that other nations kept on buying dollar all the time is the main reason why the dollar value didn't drop "too much". However, lets realize that FED had to increase the rates like crazy in order to stop inflation, which means that dollar did lose some value, maybe not so much against other currencies, but it did have a lower purchasing power.

Look at the things you can buy with 100 dollars today, and look at it 10 years ago, or 20 years ago. You will see that it has lost immense value and that's a terrible thing for all of the world because they are holding something that has lost so much value. If one nation put their money into btc instead of dollars 10 years ago, imagine the difference in value they would have.

[panganib999]

USD is consistently shooting itself on its own foot, no wonder countries would start ditching it for other currencies. If the federal reserve only stopped printing money or at least slowed down on it, things would've been different. But the current rate at which money is being printed vs burned is unsustainable and really detrimental to the health of USD's Value. I wouldn't be surprised if by a couple of years from now they truly fall from grace and fall inferior against stronger currencies of tomorrow like the Chinese Yuan or the Euro. Hiden and the government needs to makebtheir mind up and do something about it if they want the balance to remain tipped in their favor. Otherwise a paradigm shift is on the way.