Jul 22, 2022
Summary:
We’re seeing oil price shocks, commodity booms and busts, and
various factors that are threatening to de-throne the US dollar.
Why is this happening, and what does this mean for the global
economy? I have Martin Armstrong on the show to discuss this, and
he explains the various changes that have occurred—such as
sanctions in Russia and countries opting to not borrow in
dollars—that put the dollar at risk. Not only is the dollar in
danger in these conditions—this shift in currency use greatly
affects the world economy. Tune in for more information.
Highlights:
-The dollar has been the one currency that anyone can write a bond
in
-So many emerging markets issue debt in dollars so that they can
sell to American investors without the foreign exchange risk
-The dollar has had less restrictions globally, which has made it
the reserve currency
-The sanctions imposed upon Russia are devastating to the global
economy, and have ultimately split it in half
-The world economy has functioned by the free movement of capital,
but these sanctions have essentially sent off a warning to the
entire world related to getting assets confiscated
-When sanctions are put on individuals, the situation worsens
-The dollar has been weaponized effectively
-This issue will probably become more serious after 2024
-This is not worth destroying the entire world economy over
-Russia seems to have been provoked into this war
-We’re going to have high energy prices in Europe and Asia no
matter what happens
-2023 is going to be a massive turning point; it looks as though it
can’t possibly get any better, and it’s probably going to cascade
into chaos
-A lot of the real estate has been European buying
-As the dollar goes up, Japan and China are selling their bonds
-We’re in a complex situation; there isn’t just one factor that is
contributing to the economic turmoil
-Chinese real estate is the largest asset class in the world, and
it appears to be imploding
-China warned banks years ago not to borrow in dollars
Useful Links:
Financial Survival Network
Armstrong Economics