{"id":13929,"date":"2012-05-21T10:33:36","date_gmt":"2012-05-21T17:33:36","guid":{"rendered":"http:\/\/www.survival-spot.com\/survival-blog\/?p=13929"},"modified":"2014-09-30T19:49:28","modified_gmt":"2014-10-01T02:49:28","slug":"us-dollar-will-replaced","status":"publish","type":"post","link":"https:\/\/www.survival-spot.com\/survival-blog\/us-dollar-will-replaced\/","title":{"rendered":"How The U.S. Dollar Will Be Replaced"},"content":{"rendered":"

\"\"After being immersed in the world of alternative economic analysis for several years, it sometimes becomes easy to forget that most people do not track forex markets, or debt to GDP ratio, or true unemployment, or hunch over IMF white-papers highlighting subsections which expose the trappings of the globalist ideology.\u00a0 Sometimes, you just assume the average person knows what the heck you are talking about.\u00a0 This is, of course, a mistake.\u00a0 However, it is a mistake that is borne from the inadequacy of our age and our culture, and is not necessarily a product of weak character, either of the analyst, or the casual reader.<\/p>\n

The great frustration of being actively involved in the Liberty Movement is the fact that many people are rarely on the same page (or even the same book) during political and economic discussion.\u00a0 Where we see the nature of the false left\/right paradigm, they see \u201cfree democracy\u201d.\u00a0 Where we see a tidal wave of destructive debt, they see a \u201cresponsible government\u201d printing and spending in order to protect our \u201cbest interests\u201d.\u00a0 Where we see totalitarianism, they see \u201csafety\u201d.\u00a0 Where we see dollar devaluation, they see dollar strength and longevity.\u00a0 Ultimately, because the average unaware citizen is stricken by the disease of normalcy bias and living within the doldrums of a statistical fantasy world, they simply have no point of reference by which to grasp the truth when exposed to it.\u00a0 It\u2019s like trying to explain the concept of \u2018color\u2019 to a man who has been blind since birth.<\/p>\n

Americans in particular are prone to reactionary dismissal when exposed to facts that disrupt their misconceptions.\u00a0 Our culture has experienced a particularly prosperous age, not necessarily free from all trouble, but generally spared from widespread mass tragedy for a generous length of time.\u00a0 This tends to breed within societies an overt and unreasonable expectation of ease.\u00a0 It generates apathy, and laziness.\u00a0 A crushing blubberous slothful cynicism subservient to the establishment and the status quo.\u00a0 Even the most striking of truths struggle to penetrate this smoky forcefield of duplicitous funk.<\/p>\n

In recent articles, I have outlined the very immediate dangers of several potential economic events that are likely to take place this year, including the exit of peripheral countries from the European Union, the conflict between austerity and socialist spending in France and Germany, the developing bilateral trade agreements between China and numerous other countries which cut out their reliance on the U.S. dollar, and the likelihood that the Federal Reserve will announce QE3 before the end of 2012.\u00a0 All of these elements are leading in one very particular direction:\u00a0 the end of the Greenback as the world reserve currency.<\/p>\n

In response to these assertions I have received letters from some people (some of them indignant) questioning how it would be even remotely possible that the dollar could be replaced at all.\u00a0 The concept is so outside their narrow world view that many cannot fathom it.<\/p>\n

To be sure, the question is a viable one.\u00a0 How could the dollar be unseated?\u00a0 That said, a few hours of light research would easily produce the answer, but this tends to be too much work for the fly-by-night financial skeptic.\u00a0 Sometimes, the job of the alternative analyst is to make the obvious even more obvious.<\/p>\n

So, let\u2019s begin\u2026<\/p>\n

The Dollar A Safe Haven?<\/strong><\/p>\n

This ongoing lunacy is based on multiple biases.\u00a0 For some, the dollar represents America, and a collapse of the currency would suggest a failure of the republic, and thus, a failure by them as individual Americans who live vicariously through the exploits of their government.\u00a0 By extension, it becomes \u201cpatriotic\u201d to defend the dollar\u2019s honor and deny any information that might suggest it is on a downward spiral.<\/p>\n

Others see how the investment world clings to the dollar as a kind of panic room; a protected place where one\u2019s saving will be insulated from crisis.\u00a0 However, just because a majority of day trading investors are gullible enough to overlook the Greenback\u2019s pitfalls does not mean those dangerous weaknesses disappear.<\/p>\n

There is only one factor that shields the dollar from implosion, and that is its position as the world reserve currency.\u00a0 Without this exalted status, the currency\u2019s value vanishes.\u00a0 Backed by nothing but massive and unpayable debt, it sits frighteningly idle, like a time bomb, waiting for the moment of ignition.<\/p>\n

The horrifying nature of the dollar is that it is only valuable so long as foreign investors believe that we will pay back the considerable debts that we (the American taxpayer at the behest of our criminally run Treasury) owe, and that we will not hyperinflate in the process.\u00a0 If they EVER begin to see their purchases of dollars and treasuries as a gamble instead of an investment, the fa\u00e7ade falls away.\u00a0 Yet again this year Congress and the Executive Branch are \u201cat odds\u201d over the expansion of the debt ceiling, which has been raised to levels beyond the 100% of GDP mark:<\/p>\n

http:\/\/www.nytimes.com\/2012\/05\/17\/us\/politics\/obama-presses-congress-to-act-on-his-priorities.html\u00a0<\/a>
\nBarack Obama has made claims that increases in the debt ceiling are \u201cnormal\u201d, and that most presidents are prone to hiking the barrier every once in a while.\u00a0 Yet, back in 2006, when George W. Bush increased debt limits, Obama had this to say:<\/p>\n


\n\u201cThe fact that we are here today to debate raising America\u2019s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can\u2019t pay its own bills\u2026Instead of reducing the deficit, as some people claimed, the fiscal policies of this administration and its allies in Congress will add more than $600 million in debt for each of the next five years\u2026Increasing America\u2019s debt weakens us domestically and internationally. Leadership means that \u2018the buck stops here.\u2019 Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.\u201d<\/strong><\/em><\/p><\/blockquote>\n

For once, Barack and I agree on something.\u00a0 Too bad the man changes his rhetoric whenever it\u2019s to his advantage.<\/p>\n

Today, Obama now asserts that raising the debt ceiling is not an opening for more government spending, but an allowance for the government to pay bills it has already accrued.\u00a0 This is disingenuous and hypocritical prattle.\u00a0 Obama is well aware as are many in Congress that as long as the Federal Government is able to raise the debt ceiling whenever it suits them, they can increase spending with wild abandon.\u00a0 It\u2019s like handing someone a credit card with no maximum limit.\u00a0 For most men, the temptation would be irresistible.\u00a0 Therefore, one can predict with 100% certainty that U.S. spending will never truly be reduced, and that our national debt will mount in tandem until we self destruct.<\/p>\n

How has this trend been able to continue for so long?\u00a0 Our private central bank has created the fiat machine by which all economic depravity is possible.\u00a0 Currently, the Federal Reserve is the number one holder of U.S. debt.\u00a0 The Federal Reserve creates its own capital.\u00a0 It prints its wealth from thin air.\u00a0 The dollar, thus, has become its own lynchpin.\u00a0 The secretive institution which has never been subject to a full audit is now monetizing endless debt mechanisms with paper promises.\u00a0 What value would any intelligent investor put on such a fraudulent economic system?<\/p>\n

The epic dysfunction of the dollar is rooted in its reliance on perception rather than tangible wealth or strong fundamentals.\u00a0 It is, indeed, like any other fiat unit, with all the inevitable pitfalls built into its structure.<\/p>\n

Ironically, the value of the Dollar Index is measured not by its intrinsic buying power, or its historical buying power, but its arbitrary buying power in comparison with other collapsing fiat currencies.<\/p>\n

The argument I hear most often when pointing out the calamitous path of the dollar is that it is the go-to safe haven in response to the crisis in Europe.\u00a0 What the financially inept don\u2019t seem to grasp is that the shifting of savings back and forth between the euro and the dollar is just as irrelevant to our currency\u2019s survival as it is to Europe\u2019s.\u00a0 BOTH currencies are in decline, and this is evident by the growing inflationary pressures on both sides of the Atlantic.\u00a0 Ask any consumer in Greece, Spain, France, or the UK how shelf prices have changed in the past four years, and they will say the exact same thing as any consumer in the U.S.; costs have gone way up.\u00a0 Therefore, it makes sense to compare the dollar\u2019s value not to the euro, or to the Yen, but something more practical, like the dollar of the past\u2026.<\/p>\n

In 1972, just as Nixon was removing the dollar from the last vestiges of the gold standard, a new car cost an average of $4500.\u00a0 A home cost around $40,000.\u00a0 A gallon of gas was .36 cents.\u00a0 A loaf of bread was .25 cents.\u00a0 A visit to the doctor\u2019s office was $25.\u00a0 Wages were certainly lower, but they kept much better pace with the prices of the era.\u00a0 Today, the gap between wages and inflation is insurmountable.\u00a0 The average family is unable to keep up with the flashflood of rising prices.<\/p>\n

According to the historic buying power of the dollar, the currency is a poor safe haven investment.\u00a0 With the advent of bailout efforts and debt monetization through quantitative easing, its devaluation has been expedited dramatically.\u00a0 The Fed has left the door open for what I believe will be a final destructive round of publicly announced QE, weakening the dollar to near death:<\/p>\n

http:\/\/www.reuters.com\/article\/2012\/05\/16\/us-usa-fed-idUSBRE84F12320120516\u00a0<\/a><\/p>\n

The question then arises; why do foreign countries continue to buy in on the greenback?<\/p>\n

The Dollar Dump Has Already Begun<\/strong><\/p>\n

One of my favorite arguments by those defending the dollar is the assertion that no foreign country would dare to dump the currency because they are all too dependent on U.S. trade.\u00a0 To answer the question above, the reality is that foreign countries ARE already calmly and quietly dumping the dollar as a global trade instrument.<\/p>\n

To those people who consistently claim that the dollar will never be dropped, my response is, it already has been dropped!\u00a0 China, in tandem with other BRIC nations, has been covertly removing the greenback as the primary trade unit through bilateral deals since 2010.\u00a0 First with Russia, and now with the whole of the ASEAN trading bloc and numerous other markets, including Japan.\u00a0 China in particular has been preparing for this eventuality since 2005, when they introduced the first Yuan denominated bonds.\u00a0 The bonds were considered a strange novelty back then, especially because China had so much surplus savings that it seemed outlandish for them to take on treasury debt.\u00a0 Today, the move makes a whole lot more sense.\u00a0 China and the BRIC nations today openly call for a worldwide shift away from the dollar:<\/p>\n

http:\/\/news.xinhuanet.com\/english2010\/indepth\/2011-08\/06\/c_131032986.htm\u00a0<\/a><\/p>\n

With the global proliferation of the Yuan, and the conversion of the Chinese economy away from dependence on exports (especially to the West) towards a more consumer based system, the Chinese have effectively decoupled from their reliance on U.S. markets.\u00a0 Would a collapse in the U.S. hurt China\u2019s economy?\u00a0 Yes.\u00a0 Would they still survive?\u00a0 Oh yes.\u00a0 Far better than America would, at least\u2026<\/p>\n

In 2008, I warned of this development and was attacked on all sides by more mainstream economists and Keynesian proponents who stated that such a development was impossible.\u00a0 Today, it\u2019s common knowledge that our primary creditors are \u201cdiversifying\u201d away from the dollar, though MSM talking heads and those who parrot them still claim that this is not a threat to our economy.<\/p>\n

To be clear, the true threat to the dollar\u2019s supremacy is not only due to the constant printing by the private Federal Reserve (though that is a nightmare in the making), but the loss of faith in our currency as a whole.\u00a0 The Fed does not need to throw dollars from helicopters to annihilate our currency; all they have to do is create doubt in its viability.<\/p>\n

The bottom line?\u00a0 A dollar collapse is not \u201ctheory\u201d but undeniable fact in motion at this moment, driven by concrete actions on the part of the very nations that have until recently propped up our debt obligations.\u00a0 It is only a matter of time before the dollar diminishes and fades away.\u00a0 All signs point to a loss of reserve status in the near term.
\n
\nWhat Will Replace The Dollar?<\/strong><\/p>\n

My next favorite argument in defense of the Greenback is the assertion that there is \u201cno currency in a position to take the dollar\u2019s place if it falls\u201d.\u00a0 First of all, this is based on a very na\u00efve assumption that the dollar will not fall unless there is another currency to replace it.\u00a0 I\u2019m not sure who made that rule up, but the dollar is perfectly able to be flushed without a replacement in the wings.\u00a0 Economic collapse does not follow logical guidelines or the personal pet peeves of random man-child economists.<\/p>\n

Though, to be fair, and to educate those unaware, there IS a replacement already conveniently ready to roll forward.\u00a0 The IMF has for a couple of years now openly called for the retirement of the dollar as the world reserve currency, to be supplanted by the elitist organization\u2019s very own \u201cSpecial Drawing Rights\u201d (SDR\u2019s):<\/p>\n

http:\/\/www.guardian.co.uk\/business\/2011\/feb\/10\/imf-boss-calls-for-world-currency\u00a0<\/a><\/p>\n

The SDR is a paper mechanism created in the early 1970\u2019s to replace gold as the primary means of international trade between foreign governments.\u00a0 Today, it has morphed into a basket of currencies which is recognized by almost every country in the world and is in a prime position to take the dollar\u2019s place in the event that it loses reserve status.\u00a0 This is not theory.\u00a0 This is cold hard reality.\u00a0 For those who claim that the SDR is not considered a \u201creal currency\u201d, they should probably warn the U.S. Post Office, which now uses conversion tables that denominate costs in SDR\u2019s:<\/p>\n

http:\/\/pe.usps.com\/text\/imm\/immc3_007.htm\u00a0<\/a><\/p>\n

So, now that we know a replacement for the dollar is ready to go, the next obvious question would be:<\/p>\n

Why would global elites destroy a useful monetary tool like the dollar?\u00a0 Why kill the goose that \u201clays the golden eggs\u201d?<\/p>\n

People who ask this question are simply unable to see outside the fiscal box they have been placed in.\u00a0 For global bankers, a paper currency is not important.\u00a0 It is expendable. Like a layer of snake skin; as the snake grows, it sheds the old and dawns the new.<\/p>\n

At bottom, men who promote the philosophies of globalization greatly desire the exaltation of a global currency.\u00a0 The dollar, though a creation of a central bank, is still a semi-sovereign monetary unit.\u00a0 It is an element that is getting in the way of the application of the global currency dynamic.\u00a0 I find it rather convenient (at least for those who subscribe too globalism) that the dollar is now in the midst of a perfect storm of decline just as the IMF is ready to introduce its latest fiat concoction in the form of the SDR.\u00a0 I find the blind faith in the dollar\u2019s lifespan to be rife with delusion.\u00a0 It is not a matter of opinion or desire, but a matter of fact that currencies in such tenuous positions fall, and are in the end replaced.\u00a0\u00a0 I believe that the evidence shows that this is not random chance, but a deliberate process, leading towards the globalist ideal; total centralization of the world under an unaccountable governing body which operates a global monetary system utterly devoid of transparency and responsibility.<\/p>\n

The dollar was a median step towards a newer and more corrupt ideal.\u00a0 Its time is nearly over.\u00a0 This is open, it is admitted, and it is being activated as you read this.\u00a0 The speed at which this disaster occurs is really dependent on the speed at which our government along with our central bank decides to expedite doubt.\u00a0 Doubt in a currency is a furious omen, costing not just investors, but an entire society.\u00a0 America is at the very edge of such a moment.\u00a0 The naysayers can scratch and bark all they like, but the financial life of a country serves no person\u2019s emphatic hope.\u00a0 It burns like a fire.\u00a0 Left unwatched and unchecked, it grows uncontrollable and wild, until finally, there is nothing left to fuel its hunger, and it finally chokes in a haze of confusion and dread\u2026<\/p>\n

You can contact Brandon Smith at<\/em>:\u00a0\u00a0brandon@alt-market.com<\/a><\/p>\n

Alt-Market is an organization designed to help you find like-minded activists and preppers in your local area so that you can network and construct communities for mutual aid and defense.\u00a0 Join Alt-Market.com today and learn what it means to step away from the system and build something better.<\/em><\/strong><\/p>\n

<\/em>To contribute to the growth of the Safe Haven Project, and to help us help others in relocating, or to support the creation of barter networks across the country,visit our donate pag<\/a>.<\/em><\/strong><\/p>\n

[Via SHFTPlan.com<\/a>]<\/p>\n","protected":false},"excerpt":{"rendered":"

After being immersed in the world of alternative economic analysis for several years, it sometimes becomes easy to forget that most people do not track forex markets, or debt to GDP ratio, or true unemployment, or hunch over IMF white-papers highlighting subsections which expose the trappings of the globalist ideology.\u00a0 Sometimes, you just assume the […]<\/p>\n","protected":false},"author":1,"featured_media":13946,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[391,195],"tags":[],"class_list":["post-13929","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","category-news"],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/www.survival-spot.com\/survival-blog\/wp-json\/wp\/v2\/posts\/13929","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.survival-spot.com\/survival-blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.survival-spot.com\/survival-blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.survival-spot.com\/survival-blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.survival-spot.com\/survival-blog\/wp-json\/wp\/v2\/comments?post=13929"}],"version-history":[{"count":0,"href":"https:\/\/www.survival-spot.com\/survival-blog\/wp-json\/wp\/v2\/posts\/13929\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.survival-spot.com\/survival-blog\/wp-json\/wp\/v2\/media\/13946"}],"wp:attachment":[{"href":"https:\/\/www.survival-spot.com\/survival-blog\/wp-json\/wp\/v2\/media?parent=13929"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.survival-spot.com\/survival-blog\/wp-json\/wp\/v2\/categories?post=13929"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.survival-spot.com\/survival-blog\/wp-json\/wp\/v2\/tags?post=13929"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}