This One Word Could Mean the End of America as We Know It

What De-Dollarization Means for the U.S. and the World.

Today, we focus on a single word.

Best I can tell from my research, this word is barely old enough to drink. I found it mentioned for the first time back in 2000 (though it could be older). Until the last few years, the word was typically applied to countries struggling with internal financial crises… places like Argentina, Zimbabwe, Liberia, and others.

These days, the word is attached to America.

And that’s not good.

The word?

De-dollarization—the process of removing the dollar from an economy.

In terms of Argentina, Zimbabwe, et. al., de-dollarization means an effort at weaning those troubled economies off the greenback.

These countries, as you’re likely aware, have had problems with hyperinflation. When those problems arose, locals began using the U.S. dollar instead of their own currency for their daily spending needs (and in many cases still do).

Those problems were isolated to a few specific economies.

Today, however, de-dollarization is a much more sinister beast.

And a darker threat to America and Americans.

Numerous countries are now looking for ways to stop the buck from running the world economy, a role our dead presidents have officially played since 1944, when a soon-to-be-post-World-War order unanimously bent the knee to King Dollar.

Alas, America frittered away that goodwill.

We accumulated a stupidly large pile of debt that now has much of the world worried the country is run by a bunch of numbskulls who failed high school economics.

Moreover, in recent years, D.C. has done something even stupider than that—it has weaponized the dollar. It stripped Iran of accessing dollars as part of a plan to impose even greater sanctions on the Islamic country. Similarly, it has shut Russia out of the dollar economy because of its aggression toward Ukraine.

Thing is, the bulk of the world needs access to dollars for trade. And while it’s easy for us to say “well, that’s Iran and Russia!” the rest of the world sees the darker underbelly: America is ready and willing to use its currency to punish anyone who ignores D.C.’s dictates.

This has spurred countries into action…

I’ve previously mentioned that China and Russia are working on a new global reserve currency, likely backed by the assets of commodity-rich nations including themselves and Brazil, India, and South Africa. Indonesia and Saudi Arabia are looking to join that party as well.

Speaking of the Saudis, they’re considering a Chinese proposal to price some oil purchases in yuan. They’re working with India to price oil in rupees. India is also working with the United Arab Emirates to price non-oil commodities in rupees instead of dollars.

Brazil and Argentina are looking to create a common currency instead of having to transact in dollars, as is now the global norm. Russia and Iran are working together to build a cryptocurrency fully backed by gold for use as a mechanism in cross-border trade.

And at a conference in Singapore back in January, Southeast Asian officials from various countries spoke about de-dollarization efforts underway.

All of that might seem like a big ol’ shoulder shrug to a lot of people because, aside from China, most of these countries might appear too economically small and feeble, particularly relative to the good ol’ U.S. of A.

That’s a mistake.

Those countries combined have big influence in the world and control vast resources. If, as a group, they all ultimately pursue their joint and individual de-dollarization goals, it dramatically shifts the world… and that hits America and Americans hard.

If they all turn around and stop using the dollar, it means the world doesn’t need as many dollars as it needs now.

That means a sea of unwanted greenbacks… which pushes down the value of the buck relative to other currencies… which raises prices on all the imports Americans buy, from cars to oil to electronics, and beyond… which keeps inflation high… which drives up interest rates… which pushes down the value of government and corporate bonds, and drives up the debt-servicing costs Uncle Sam must pay on that stupid mountain of IOUs… which slows the economy into deep stagflation… which, combined with higher interest rates, drives down home prices… which impacts consumer sentiment and reduces disposable income… which hits corporate profits, thereby driving down stock prices… all of which ultimately reduces American living standards.

That’s how de-dollarization flows through each of our lives.

And that’s why de-dollarization is such a dark and untamed beast.

I see a lot of media commentary insisting “the dollar still dominates” and that 60% or more of the world’s currency reserves are in USD. That is true.

But it is also true that the #1 selling mobile phone in the world in 2007—the year the iPhone debuted—was from Nokia, which controlled nearly 38% of the global mobile phone market. Apparently, Nokia still makes phones… who knew? I haven’t actually seen a Nokia in the wild in at least a decade.

Either way, the fact remains that kings are regularly deposed.

To think the dollar is “King In Perpetuity” is not only historically ludicrous, it’s a financial catastrophe awaiting those who subscribe to such a belief.

Here at the end, let me say that those last 850 words or so were not written to scare you. They were written to, hopefully, enlighten you—to give you a deeper understanding of the dollar’s role in the world relative to your life.

I want you to be prepared for this ongoing trend. It’s effectively unstoppable at this point because the U.S. has simply abused the exorbitant privilege it was given as owner of the world’s reserve currency.

A sea change is now taking place.

It might emerge slowly… or it very well could rush in like a tidal wave, depending on actions that other countries take, particularly China and Saudi Arabia.

We can either rise with the new tide rolling in by owning non-dollar assets (like gold, bitcoin, foreign stocks, and safe-haven currencies such as the Swiss franc)… or we sink beneath it.