The Democrats under Biden seem to believe that America and its government are so powerful that anything that they think and say must be the truth, and that any who disagree are wrong and must be cancelled. To fair there is a lot of disinformation and misinformation out there, but head space is a legally guaranteed free market in the USA. It occurred to me the other day that maybe part of the reason that vaccines prior to COVID have much lower adverse reaction rates is precisely because they weren’t mandated. There was no captive market and so a better product had to be made. It’s the same with ideas. If you shut down the free market of ideas, you get lower quality ideas. I suspect that is what has happened to the Democrats.
Zero has collected good links on this:
There are many ways the big players, India, Russia and China, can find to settle their transactions. Throw in most of central Asia and Iran. All have all been big gold accumulators. They may find ways to settle in gold without using London banks. They are looking at settling in each others’ currencies. I think it is conceivable that they could set up their own USD trading system so they can deploy their USD reserves. It could be bags of cash, local bank USD notes, or even something like Tethers. These guys together are huge. They need one anothers’ stuff, so they will find a way. The USA needs their stuff, particularly from China so they won’t be able to cut China out of SWIFT. And therein lies the stupidity of Biden’s move: it will be both ineffective and self-damaging. All the Chinese had to do was wait. I’m sure there’s a good Sun Tzu quote about that.
What are the consequences for Australia? Probably not much while commodity prices are soaring. The AUD may rise against the USD, but I wouldn’t trade it unless there was a firm break above 0.74. If we keep pulling in Indians and Chinese, you can expect our banks to participate in whatever new payment systems get set up. Union Pay is already pretty widely used here.
For trading, more gold price rises looks likely. I think the oil price will fall as the middle east ramps up production. They have no reason to add to electric vehicle incentives. The Chinese will buy as much Russian oil as they can get. Cross border oil volumes will increase which will feed through to less demand on the seaborne market hence lower prices everywhere. Crypto may benefit too particularly if there’s a deliberate loosening by the big Asian players, but I reckon that’d be a last resort if they can’t make a proper deal. They are the ones who’ve been toughest on crypto in the last few years. However, its already in use by the Russians in greater volumes that at first thought. I remain surprised how mute the impact has been on the BTC price. I note Monero is up 10% in the last week as I write.
Hopefully you have some ideas and links too.