JRL NEWSWATCH: “The dollar is our superpower, and Russia and China are threatening it” – Washington Post/ Fareed Zakaria
“The most interesting outcome of the [Sino-Russian] summit [was] … Putin [saying], ‘We … favor … using the Chinese yuan for settlements between Russia and the countries of Asia, Africa and Latin America.’ … [T]he world’s second-largest economy and … largest energy exporter are actively trying to dent the dollar’s dominance … of the international financial system … [that] gives Washington unrivaled economic and political muscle. The United States can slap sanctions … unilaterally, freezing [sanction targets] out of large parts of the world economy. And when Washington spends freely, it can be certain that its debt … will be bought up …. America’s politicians have gotten used to spending seemingly without any concerns about deficits[.] [P]ublic debt has risen … from roughly $6.5 trillion 20 years ago to $31.5 trillion today. The Fed has solved … financial crashes by massively expanding its balance sheet … from around $730 billion 20 years ago to about $8.7 trillion today. … [T]his only works because of the dollar’s unique status. If that wanes, America will face a reckoning like none before.”