For years, we’ve all heard the term “New World Order.” Well, it’s here… just not in the way the conspiracy theorists expected.
Those who see dark shadows in full sunlight foretold of a one-world government rising up to claim totalitarian control over humanity. But instead of a monolith, the emerging new world order is actually a divided global system that, nevertheless, will still radically disrupt Americans’ everyday lives.
This disruption is coming at the hands of the BRICS nations—Brazil, Russia, India, China, and South Africa.
They’ve been around now as a bloc for a good 20 years or so. But today, they represent a huge threat to U.S. economic dominance and the American way of life.
Their plan: Attack the U.S. dollar.
I Predicted the BRICS Currency 12 Years Ago
China and Russia are working together to develop a new global reserve currency—the BRICS currency—to compete with the dollar. I first wrote about this more than a decade ago, after meeting with a former Soviet Politburo official in the snowy woods of Estonia. Lots of derision fell on me for that prediction.
Alas, I was right, and here we are.
Now, China and Russia are ramping up this effort several notches. They’re not going alone on this. They’ve brought in their BRICS counterparts… as well as a ton of other countries who are willingly, if not eagerly, seeking a replacement for the dollar. And that’s where bigger problems begin for America…
See, 41 countries have now expressed interest in joining the emerging BRICS empire. Among the list are Mexico, United Arab Emirates, Venezuela, and Nigeria.
Many Americans might scoff at those names. After all, they can’t compete against the U.S. in any meaningful way… at least not individually.
But we need to zoom out and examine the big picture. All of those are major oil-producing nations. And that’s a huge problem for the dollar.
The Decline of the Petrodollar at the Hands of a BRICS Currency
Right now, the dollar owns the oil trade. All oil has been priced in greenbacks since 1974, when the Saudis agreed to that plan. Since then, the so-called petrodollar has ruled the world.
That’s of great benefit to America for a few reasons:
- It creates constant demand for dollars as countries sell their home currency to buy dollars that they then trade for oil.
- It means the U.S. doesn’t face currency conversion costs when buying oil from abroad (and, yes, we buy oil from overseas every day of the year). In turn, that means gasoline prices are cheaper for Americans.
Plus, there’s a third benefit that is tangential but critical to Uncle Sam: America’s debt.
Demand for the dollar is what has allowed America to run up such mountainous debt ($32 trillion now). Right now, other countries need to buy Uncle Sam’s debt for facilitating trade, buying oil, and whatnot.
But what happens if demand for dollars diminishes…
What happens if more global trade starts happening in a new BRICS currency… or oil purchases start happening in the currency of one of the major BRICS members? China is hot to see the world begin pricing some oil in its currency, the yuan. Already, Saudi Arabia and the UAE have expressed interest in that.
Not hard to imagine that Mexico, Nigeria, and Venezuela would do so as well as members of a BRICS empire. That would drain more dollar demand.
And that would be devastating for you and me and the rest of American families.
The Problem of Too Much Debt
Uncle Sam wouldn’t be able to sell as much debt as he needs to sell… which means he has to offer higher interest rates to entice buyers. (We’ve already seen the early impacts of that. In last year’s fourth quarter, America paid a record $213 billion in interest payments on Treasury debt. A year earlier, it paid just $63 billion.)
Higher interest rates affect everything in America, including the rates you and I pay as consumers on credit cards, mortgages, car loans… all kinds of debt.
Moreover, as dollar dominance shrinks, it leads to a weakening dollar. The result of that sees the price we pay for everything we import, from cars and clothes to furniture and TVs, shoot higher… entrenching inflation in America.
And all of that will cause a monetary Come To Jesus moment when America’s debt—combined with declining dollar dominance and the higher interest rates that engenders—reaches a level that’s simply too much for the country to bear. (Note: even Treasury Secretary Janet Yellen is now telling us that declining dollar dominance is here to stay.)
Stepping back for a moment, the question we really need to ask is, why now? Why are the BRICS and nominal American allies like the UAE and Saudi Arabia suddenly willing to turn against us?
The answer is our debt (and the fact that countries are tired of D.C. using the dollar to punish other countries).
Those factors combined—our soaring debt and the global movement to undermine the dollar—will lead to a monetary “super shock” later this decade…
So there you have it. The new world order from an unexpected point of view.
If the U.S. didn’t have such monumental debt, and if America didn’t use the dollar as a weapon, a BRICS currency would not be an issue for the greenback.
But here we are…
The winning investments, of course, will be gold and silver, certain stocks priced in non-dollar currencies, and bitcoin.
Prepare accordingly for the crisis to come.