Through the ages, different national currencies have played the role of global reserve currency. In my personal definition, a reserve currency is a currency, like the US Dollar is today, that is being used by most of the world to price energy transactions. Saudi Arabian oil, for example, is priced in USD. So, since buyers and sellers of large quantities of oil will need to accept and hoard USD, this gives the US economy tremendous buying power over the rest of the world.
Historically, a reserve currency tends to hold its status for about a century. From about the year 1450 to 1550 or so, it was the Portuguese pesos. During the 18th century, it was the French franc, then the British pound, and today, since the early 1900s, it has been the US dollar.
But the power base of the world’s only self-proclaimed superpower has been slowly eroding, certainly during the last fifty years. The United States has been printing so much money that the US dollar monetary base has been inflated by trillions and trillions of dollars, in record exponential tempo. In fact, the United States has all but turned intself into a Zimbabwe, a hyperinflated economy waiting for financial collapse.
So, what’s preventing the US economy from collapsing, for now? Well, one reason the US economy is still going strong is that, unlike Zimbabwe, investors from all over the world have supplied massive credit to the US economy. Nations and organizations around the world are betting big on the American Empire, expecting their investments to pay off or appreciate over time.
Foreign creditors own American businesses, real estate, land, even memorial sites, harbors, and theme parks, and they have sold countless loans to the US government, all in exchange for the promise, but not the guarantee, that the US economy will continue to be able to dominate the world.
The US military is the primary source of this domination. There is a reason why US Congress has spent trillions of dollars on funding the military. It is the military that plays an important role in aligning key global players with US interests. It should be clear by now that a lot is at stake, and much of the world will not openly condemn US military aggression for the sake of protecting their investments in said US economy.
When in October 2000, Saddam Hussein apparently threatened to price the sale of oil in Euros—a multinational currency—instead of US dollar, his days were counted. A year later, 9/11 happened, the Twin Towers collapsed, and in the wake of the terror shock, the American public approved an all-out war on the Middle East, starting in Afghanistan, ending with Saddam’s capture and kill.
The US economy was safe again, especially from a possibly Iranian split with the US dollar. Iran, like Saudi Arabia, is a major oil producing country, and even if Iran won’t sell much of its oil to the US, it still matters whether or not Iranian oil can be bought with US dollars. Something had to be done to assure Iran would keep pricing oil in US dollars, and now you know why, years later, Barack Obama literally flew planes full of dollar bills to Teheran. A bribe.
In 2009, when Libya’s Gadaffi proposed to price oil in African gold. At the time, Libya alone had about three times as much gold in its vaults as Great Britain, for example. Pricing oil in golden dinars would have bankrupted the US economy, since the global demand for dollars would have evaporated, and African nations rich in gold resources might have dominated the world.
Two years later, in 2011, a US-led coalition started the invasion of Libya, to remove a dictator and bring democracy.
The threat of pricing oil in anything other than US dollars still remains, however. Since getting rid of the US dollar as a global reserve currency also means a weakened US economy will no longer be able to fund its military, a lot of enemies of American democracy continue to dream that dream.
But the fact that the US dollar will eventually be superseded by another global reserve currency is inevitable. It is only a matter of time. What if the world decides to price oil in the Chinese currency, the renminbi, the people’s money, or yuan for short? China is too big to fail. The US army is too small to enact a successful regime change in Beĳing. China has too many powerful geopolitical supporters, including Russia with its alleged nuclear arsenal, and Iran, with its massive oil reserves.
Getting rid of the US dollar also means getting rid of billions of dollars of funding American taxer payers hand out to Israel each year. Israel, presently acting as an outpost for US interests in the Middle East, may end up getting cut off like the black sheep of the US family. Without its military funding, Israel would cease to exist. It might be overrun by better-funded Arab players, or even taken out by Iran.
Israel, of course, cares about its own existence more than about that of the United States. It is perfectly possible that Israel, despite decades of freeriding on US taxpayers’ money, may, in the end, defect to China. When, not if, that happens, China shall use Israel as its outpost to pursue its own interests in both the Middle East and in Europe.
So, while the US dollar still has its respected value, the US Federal Reserve, a privately-owned company, has continued to print trillions and trillions dollars more, to invest in the US military, to invest in US businesses, and to bribe allies and partners abroad. They call it “quantitative easing” because “turning on the printing press” sounds like something a Third World country would do. Of course, it’s the same thing.
When, not if, the US dollar value plunges relative to the rest of the world, this nation of barely 300 million will not have a large enough labor force to compete with China. And this is one of the reasons why the US, and Europe, are so aggressively pursuing an open border policy, making the world’s surplus masses feel at home in the West. Without military or economic power, all that is left is the land you own and the people who work on it.
Western elites know this: if everything goes wrong, the only way to continue to compete with China is to bring in hundreds of millions if not billions of new workers and consumers into the West. Since the African continent’s population is projected to grow to up to 4 billion people before the end of this century, fusing Africa with Europe, in order to create one giant Eurafrican market, has become the solution-of-last resorts for the West to stay competitive with China.
Indeed, diversity, inclusion, and multiculturalism serve no leftist ideals at all but only the cold harsh reality of a future labor-based West that needs to compete with the East by employing a larger, and lower-cost labor force.
That means the wealth white people once imagined having in the 1950s will be out of reach for the majority of humanity for ages to come. Middle classes may never relive such prosperous times, ever again. In fact, middle classes may be dissolved into a gigantic lower class from which there is no escape, like slavery and feudalism.
Yes, in my opinion, the future is bleak, even without the prospect of global third world war.
But if the US dollar, and the Euro too, are susceptible to be crushed by a Chinese currency, or an African golden dinar, then how will rich white elites protect their relative wealth?
Enter Facebook Libra. The Libra project was an attempt, although it already failed, to create a digitial currency, and make it a global currency able to compete with a digital Chinese yuan. There is already another project which has quietly been working in the shadows for six or seven years now, the Reserve Protocol, backed by, for example, Peter Thiel, the co-founding genius behind PayPal.
A digital reserve currency, if it proves itself to remain stable enough, may attract the savings and investments of rich people in the West, people who wish to preserve their wealth in case of a US dollar collapse, people who may not have access to Chinese bank accounts or African vaults.
I foresee, however, another use for such a new digital reserve currency. If a large amount of wealth were stored in such a digital asset, it could be leveraged easily to invest in African markets. The Reserve Currency could be made available to consumers and workers living in the African continent, and so, tie their economic activities to Western economies.
I certainly think this is the ultimate war we are facing: a currency war that is less about direct conflict between China and America, but rather about an indirect conflict over who gets to tie 4 billion Africans to their economy. The West having already pivoted itself as a multicultural, inclusive, open-border free-for-all may in fact succeed in winning the hearts of minds of billions of African consumers.
At the expense, of course, of the survival of Western peoples.
For what keeps Western elites rich and powerful, means to write off Europe’s native white populations, and to sell off American families as collateral damage in the currency war.