This thread my not be the place to bring this up. However I feel that it needs to be mentioned here since events occurring in Ukraine could be the catalyst for a change in the global economy. Many posts have eluded to this but if the moderators feel that a separate thread is require, or that we drop the subject (since it is off topic) so be it. I’ll respect what is decided.
One thing that is beginning to concern me are the somewhat limited monitay threats that are being generated by the government in Washington. The US has unfortunately lost some of its Allies in the last five years (spying, bad politics, etc..) and I fear that other countries will no longer be willing to tolerate Washington’s total dominance of the world dollar standard. Washington uses the dollar-based international payments system to reprimand the economies of countries that resist international law and to some extents Washington’s political will.
There is a possibility that Russia and China many have had enough. They may begin to disconnecting their international trade from the dollar and switch to the Euro or another currency. Therefore, Russia may begin to conduct its trade, including the sale of oil and natural gas to Europe, in Euros, Rubbles or in any currency which is not the dollar.
America has been very fortunate in that it is the only nation that can print dollars (legally) and as a result can control inflation since the world utilizes the dollar as a trading standard. However if the dollar is removed from the international trading standard, we will begin to see inflation, or even hyperinflation begin in the USA. Which could a very detrimental effect on the world economy as a whole.
Several other nations around the world have tried to print more money to cover the lack of revenue or to pay for government projects and have inadvertently caused hyperinflation. Hyperinflation is a tipping point, death spiral; positive feedback loop that once entered is very hard to get out of. What happens is that the more the central bank prints new money and buys bonds, the less other people want to buy them. But the less other people buy them the more the central bank has to so that the government has enough cash to spend. Once this "adverse feedback loop" is started you get a flood of new money as all the short term bonds are monetized. This problem can be complicated even further if a particular nation has a large amount of short term debt (typical for country about to get hyperinflation).
Thank you all for listening to my fear in the form of a rant.
