Tuesday, August 2, 2011

Phase Six Of The Currency Wars?

This series has focused on the benefit that the USA derives by enjoying the U.S. Dollar as the world's reserve currency.

In the previous post of the series we quoted a past Secretary of The Treasury who stated that "if we didn't have the dollar as the de facto reserve currency of the world, we'd be Greece."

Let's acknowledge that "we'd be Greece" is a phrase composed of strong words, yes, words that conjure up a catastrophic image, including an image of Greece style rioting in the streets of America.

That is especially so ("a catastrophic image") when we consider the acknowledged U.S. military preparations for martial law in case of just such an eventuality:
A new report by the U.S. Army War College talks about the possibility of Pentagon resources and troops being used should the economic crisis lead to civil unrest, such as protests against businesses and government or runs on beleaguered banks.

“Widespread civil violence inside the United States would force the defense establishment to reorient priorities in extremis to defend basic domestic order and human security,” said the War College report.

The study says economic collapse, terrorism and loss of legal order are among possible domestic shocks that might require military action within the U.S.
(Government of The Government). Is this issue of social discontent over a prolonged economic disaster that serious?

Serious enough to require military intervention of the posse comitatus type within the USA?

The Russians, upon observation of the recent U.S. "debt crisis debate", agree with the majority of Americans who think government financial incompetence is quite serious:
Russian Prime Minister Vladimir Putin accused the United States on Monday of living beyond its means "like a parasite" on the global economy and said dollar dominance was a threat to the financial markets.

"They are living beyond their means and shifting a part of the weight of their problems to the world economy," Putin told a Kremlin youth group while touring its summer camp north of Moscow.

"They are living like parasites off the global economy and their monopoly of the dollar."


"If over there (in America) there is a systemic malfunction, this will affect everyone," Putin told the young Russians.

"Countries like Russia and China hold a significant part of their reserves in American securities ... There should be other reserve currencies."
(Putin On World Currency, emphasis added). More and more nations of the world think that the U.S. Dollar should not be the world's reserve currency, which means they are willing to see us turn ourselves into Greece.

The series is chronicled more completely on the Series Posts page, under the heading "Currency Wars".

China is expressing the same sentiment that Russia is, now that S&P has downgraded the rating of the USA's credit.

Some relevant video is available on Newsy.

1 comment:

  1. The media like to divert attention from the excesses and failures of U.S. economic policy (imperialistic kapitalism) to other economic blocks, like Europe:

    "The truth is, just as the American media missed the real story when it came to weapons of mass destruction in Iraq, the housing bubble, corruption of the credit rating agencies and an imminent economic meltdown, the crystal ball gazers in the US media have a terrible track record when it comes to Europe."