Weaponizing the Dollar

Published on
May 15th, 2019
Duration
12 minutes

Weaponizing the Dollar

Future Fears ·
Featuring Luke Gromen and Brent Johnson

Published on: May 15th, 2019 • Duration: 12 minutes

Do the U.S. government and the Federal Reserve have the stomach to break the global financial system with the dollar? Luke Gromen of Forest for the Trees and Brent Johnson of Santiago Capital join Real Vision co-founder Grant Williams to examine the knock-on effects of an escalating currency war. This video is excerpted from a piece published on Real Vision on February 4, 2019 entitled “The Great Dollar Debate.”

Comments

Transcript

  • WB
    William B.
    16 May 2019 @ 21:30
    Aug. 6, 2018 Zerohedge article on China's options (and weaponizing the US Dollar) below. It's cheaper to defeat China militarily through increased US Dollar interest rates than ever increasing military spending alone. Given Dept. of Commerce blacklisting of 70 Chinese companies including Huawei this week, assume Dollar weaponization is coming. https://www.zerohedge.com/news/2018-08-05/china-now-left-just-three-options-and-they-are-all-equally-bad
  • CL
    Chris L.
    16 May 2019 @ 04:47
    What Luke doesn't ever factor in, the dollar shortage in 2014, which he continuously mentions, began as M0 collapsed. Physical currency circulating has been contracted for four years and nobody mentions it. Currently contracting at 12.4 percent YoY, there's a five year low in M0. via @themacrostrat
  • DS
    David S.
    15 May 2019 @ 21:56
    Good discussion. I am going back to other Gromen presentations. To a novice in FX, it looks like countries with excess Yuan would want to spend these on Chinese exports which would help the Chinese economy somewhat. Plus, countries with Yuan denominated debt can better make interest and principal payments without going through the intermediary dollar. For many years, China used Hong Kong to export manufactured goods from mainland China but put made in Hong Kong for tariff and trade purposes on the products. Is it not possible for another country to use the its Yuan to buy Chinese goods and change the country of origin label to reship? This looks like a plus for China on more than just commodity import level. China has been paying Russia for oil for a long time in Yuan, is this the funding source for part of Russia’s gold purchase? Thanks for replaying a portion of the original video. International trade and tariff wars are so complicated, there are a lot of knock-on effects. DLS