U.K. based The Independent is reporting that several Arab states, alongside China, Russia, Japan, and France, are to end oil transactions in the U.S. dollar, instead dealing in mixed currencies like the euro, yuan, yen, gold, and perhaps even a planned unified currency:
Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars.
The plans, confirmed to The Independent by both Gulf Arab and Chinese banking sources in Hong Kong, may help to explain the sudden rise in gold prices, but it also augurs an extraordinary transition from dollar markets within nine years.
Apparently India and Brazil are also interested in this new arrangement, undoubtedly to the displeasure of Washington.
This shouldn’t surprise anyone as the dollar continues to weaken. Foreign governments holding dollar assets do not want to see their wealth diminish. The U.N. has been advocating a global currency to wean nations off the dollar, and many governments have swapped the dollar in favor of the euro already.
Americans should be wary of a devalued dollar. With the way this administration is spending, the only logical outcome is further weakening of our currency. There may even be a time when China, India, and Japan stop buying our debt and start dumping the dollars. That will be as close to financial armageddon as we’ll ever see.
