With the explanation that it had to punish Russia for its war in Ukraine, the west stole over $300 billion of Moscow’s money. With the explanation that 9-11 families deserved compensation, the U.S. stole $7 billion from Afghanistan (oh no, it had nothing to do with revenge for losing the war, how could you even think such a thing?) With the explanation that, well, it just didn’t like Venezuela, the U.K., or rather the Bank of England, stole roughly $2 billion of that country’s gold.
See a pattern? Leave your nation’s money in a western bank, and it might not be yours for very long, especially if you in any way bother western politicos, like having an economic system they disapprove of, or sending them packing when they invade your country, or telling NATO where to get off when it threatens to absorb a neighboring nation and plant missiles there. In this last instance, it would have been far better had Moscow waged economic war on NATO countries, instead of an actual war on Kiev. But as it happened, Ukraine got clobbered militarily and dreadfully, and the west launched an economic blitzkrieg on Moscow, accidentally firing all its financial missiles at itself.
The west’s larcenous behavior erodes trust in its financial system, to understate matters. Keep your savings in dollars or in western banks and you could lose them, if say, you don’t let NATO invade your country and topple your government, or balkanize your country, or even if you don’t privatize your ports, or worse, you let China invest in them. Not saying these last two have happened, but if the past is precedent, they sure could. All over the world, in recent months, countries finally got the message, and some feel vulnerable. So things have begun to change in ways that do not bode well for Washington’s global financial hegemony. It is certainly likely, for example, that Chinese leaders look at their more than one trillion dollars in U.S. debt and now think “Gee, maybe that’s not such a great idea.” Indeed, compared to May, 2021, China’s holdings in U.S. treasury securities this year fell by 9 percent.
All this is of a piece with the eye-popping news, scarcely mentioned in western media, that Russia, China and the rest of the BRICS countries – Brazil, India and South Africa – “are officially working on their own ‘new global reserve currency,’” as Information Clearing House reported on July 25. Currently the dollar holds that primo place. The dollar is the world’s reserve currency, with all the many privileges that entails, privileges which, if completely lost, would entail a western financial contraction the like of which the world has probably never seen.
But maybe they won’t be completely lost. There will be the west and then also, separately, the rest – with the rest, of course, being far bigger, population-, resources- and ultimately wealth-wise. “The issue of creating an international reserve currency based on a basket of currencies of our countries is being worked out,” said Vladimir Putin at a BRICS meeting in June. Moscow began dumping its U.S. treasuries back in 2018. The west’s ill-advised economic war on Russia has now accelerated developments that will – surprise! – backfire massively.