Toppling "King" Dollar

One "BRICS" at a Time

Another week, another Jackson Hole show and more of the same, Robert Preston and his well known “Trouble” scene from “The Music Man” once again takes the stage.

Other than reiterating the economic problems faced globally, two things concern me most; (1) the potential to raise our inflation target to 3% and (2) a basic understanding that there’s no way to solve the “money printing” problems we created in “fixing” the last fifteen years of “problems” implemented to solve them. Will we ever get it right?

It’s a big world out there but it’s getting smaller when it comes to “associations” that are beginning to emerge between countries and regions that sucked money out of the U.S. for years now seeking alliances with entities we deem as adversarial. The Dollar, as predicted in one of my first articles, “War With No Bullets” is again under attack.

Potential BRICs Group Expansion

A deal to expand the BRICS group of leading developing countries appeared stuck in eleventh hour negotiations. Agreement to expand BRICS,Brazil, Russia, India, China and South Africa, could see dozens of interested nations seek admission.

More than 40 countries have expressed interest in joining BRICS, representing a pool of potential candidates, from Iran to Argentina, motivated largely by a desire to level a global playing field. They have little in common. This lack of coherency will delay an agreement in the near term but the “table is set” to begin abandoning the “Dollar” as the “world’s” currency.

A Better Way Versus Expansion

BRICS nations can strengthen cooperation on “cross-border” payments by promoting local currency settlement. Who really needs actual membership? Just encourage more local currency usage in trade and financial transactions; simply shift from the Dollar.

The BRICS bloc planned to set up an alternative international payments system to the SWIFT platform. Makes a lot of sense, doesn’t it? Russia likes the idea especially since it’s been “cut off” from SWIFT, as does India whose BRICS representative called it an “area of promise".

Look, the days of “King Dollar” are limited and decreasing day-to-day. The effects are voluminous; (1) decreasing the Dollar’s value on a “supply & demand” basis; (2) costing the “money center” banks an electronically processed “sit-on-you-butt” cash flow; and (3) increasing the U.S. inflation rate. We’re an overall importing country. It’s not at all good no matter how you cut it but there’s little to do to reverse the trend.

Public Debt Loads Are Out of Control

The steep jump in public debt loads over the past 15 years, as governments borrowed large amounts of money to battle the Global Financial Crisis and the fallout from the COVID-19 pandemic, is irreversible.

Since 2007, worldwide public debt has ballooned from 40% to 60% of GDP, on average, with debt-to-GDP ratios even higher in the advanced countries.

Despite mounting pressure, debt reduction is unlikely in practice. Economies cannot outgrow their debt burdens due in part to “aging populations”; Elon Musk is correct once again. Public financing for healthcare and pensions will only fuel inflation. High public debts are here to stay. Another fine mess we’ve gotten ourselves into, eh?

It’s reunion week. It will be great to see everyone. I figure most of us will look like our parents, otherwise I hope they have “name stickers”. It will be good to get back to the “Burgh” and once again ride the Thunderbolt at Kennywood Park together with a few other rollercoasters, the Racer and the Jack Rabbit, if they let me on.

The book is done. From the Word file it’s slightly under 300 pages and 90,000 words. It’s off to the publisher and should be available next month on Amazon / Kindle. Now it’s time to finish off the concurrent Udemy course for those of you who don’t read as much as you should. Everyone will learn at their own pace. If you pick it up the first time, great if not email me at david@thetickeredu.com so I can further help. Let me know what you think about the excerpt, I’m all ears.

Back for an “encore” we have one of my favorites from R.E.M., “It’s The End Of The World As We Know It (And I Feel Fine)” but in reality I don’t. There’s no easy way to fix the problems we’ve created. Politically speaking we’re in trouble. A Biden / Trump rematch would serve no one. It would be nice to simply vote for a “platform” that the “powers that be” would be required to maintain and execute as stated. It’s obvious to me that Biden is a figure head so it’s possible. My trust for those in government is not strong. Their primary objective is to remain in office well past their “expiration” date, not to do what’s best for those that elected them.