Petroyuan Coming? End of the dollar?

[Kevin88660]

China is accelerating the pace of RMB internationalization.

Whenever there is a shift in the global reserve currency, the new challenger usually needs to come in with some form of backing with complex assets such as energy or precious metal, and leads to their rapid price appreciation.

The doomsday financial sphere has been a crying wolf for over a decade. But Maybe the wolf is coming this time.

RMB becomes Brazil's second-largest international reserve currency

The Chinese yuan, or renminbi (RMB), has surpassed the euro to become Brazil's second-largest international reserve currency.

news.cgtn.com

China completes first LNG cross-border yuan settlement transaction - Global Times

www.globaltimes.cn

https://www.nasdaq.com/articles/petrodollar-dusk-petroyuan-dawn:-what-investors-need-to-know

 

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[YanC]

Funny to read this post now as earlier today I opened a position in Singaporean bonds as a proxy to play exactly what you are talking about. I used to have one in Chinese bonds but couldn't accept to be relying on the CCP.

Yields are good enough to be interesting and it serves as a hedge against the USD and especially for me against the EUR. I also feel much more comfortable owning Singaporean debt than French debt.

Dedollarisation is probably real but these are deep processes that play out on very high time frames.

 

[Kevin88660]

Funny to read this post now as earlier today I opened a position in Singaporean bonds as a proxy to play exactly what you are talking about. I used to have one in Chinese bonds but couldn't accept to be relying on the CCP.

Yields are good enough to be interesting and it serves as a hedge against the USD and especially for me against the EUR. I also feel much more comfortable owning Singaporean debt than French debt.

Dedollarisation is probably real but these are deep processes that play out on very high time frames.

Major obstacle towards RMB internationalisation is self-imposed by China. Largely due to capital control. If global capital could go in out of China quickly at ease that will increase the demand of RMB.

My trading play will be more focused on energy and precious metal. A currency crisis of Dollar will inevitably benefit these assets.

 

[Kevin88660]

I already started accumulated bullions from more than ten years ago.

I used to read financial information and geopolitical events daily. It was quite an awful time distracted away from building real business related skill.

It just seems that the wolf might be really coming this time. I added in some derivate position of leveraged silver 3SIL. (not financial advice).

For members who are familiar with goldbug community kind of stuff, over the past few years there were successful lawsuits from miner companies against financial speculators keeping the price of precious metals down.

Ex-Wall Street Trader Convicted of Fraud in Precious Metals Spoofing Scheme

A federal jury in the Northern District of Illinois convicted a former trader at JPMorgan Chase and Credit Suisse today of fraud in connection with a spoofing scheme in the gold and silver futures markets.

www.justice.gov

This is one of the major event on “conspiracy theory” turning into fact.

Another popular “conspiracy theory” was that China holds more gold than its official reserve, calculated from Hong Kong imports figures alone.

We shall see.

OPEC just announced another round of production cut to boost price.

F. William Engdahl ‘s thesis on petroldollar was that America allowed OPEC’s oil embargo using Israel as an excuse. It was a win-win for both as OPEC raises prices to increase market cap of oil as a commodity. As dollar is getting used to price oil, this creates demand for dollar.

If history repeats, China could be just copying it. Xi just visited Saudi King MBS as well, before the OPEC’s announcement on production cut.

 

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[Xeon]

China is accelerating the pace of RMB internationalization.

Whenever there is a shift in the global reserve currency, the new challenger usually needs to come in with some form of backing with complex assets such as energy or precious metal, and leads to their rapid price appreciation.

The doomsday financial sphere has been a crying wolf for over a decade. But Maybe the wolf is coming this time.

RMB becomes Brazil's second-largest international reserve currency

The Chinese yuan, or renminbi (RMB), has surpassed the euro to become Brazil's second-largest international reserve currency.

news.cgtn.com

China completes first LNG cross-border yuan settlement transaction - Global Times

www.globaltimes.cn

https://www.nasdaq.com/articles/petrodollar-dusk-petroyuan-dawn:-what-investors-need-to-know

I'm now seeing news daily about more and more countries embracing this concept lol, including ASEAN. Not sure if it's possible to have 2 world reserve currencies, e.g: the USD and whatever currency China/Russia comes up with.

I only worry about my fixed deposits if something happens to the USD.

 

[Kevin88660]

I'm now seeing news daily about more and more countries embracing this concept lol, including ASEAN. Not sure if it's possible to have 2 world reserve currencies, e.g: the USD and whatever currency China/Russia comes up with.

I only worry about my fixed deposits if something happens to the USD.

All these deals and discussion are planned behind closed doors for month at least. I think this is just news release to the press now as the system is ready for transacting greater volume of currency.

I heard about gold backed RMB being prepared for global trade as early as 2011. It was largely seen as “conspiracy talk” back then.

 

[Kevin88660]

Anwar: Malaysia, China to discuss ‘Asian Monetary Fund’ to cut dollar dependency

China is open to talks with Malaysia on forming an Asian Monetary Fund, said Prime Minister Datuk Seri Anwar Ibrahim, amid the world’s growing impatience with the dominance of the US dollar. Anwar said he proposed setting up the fund at the Boao forum in Hainan last week, stressing the need to...

www.theedgemarkets.com

 

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[Jbrow327]

Joe Biden has plans for us lol. Discuss. How does this affect most people let alone fastlaners who have made it?

 

[Kevin88660]

Joe Biden has plans for us lol. Discuss. How does this affect most people let alone fastlaners who have made it?

I have a thread on petrolyuan under investment section. Might we could merge them instead of having multiple discussion here and there.

 

[Jbrow327]

I have a thread on petrolyuan under investment section. Might we could merge them instead of having multiple discussion here and tsure

I have a thread on petrolyuan under investment section. Might we could merge them instead of having multiple discussion here and there.

Sure

 

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[BizyDad]

If global capital could go in out of China quickly at ease that will increase the demand of RMB.

I will just throw out that I am nowhere close to an expert on this subject. But I have to ask...

Would it?

Or would outflow exceed inflow and capital flee to the US? That's what happened the last time China got a little loose in its policy, right? And that's why they closed the doors again.

Idk... Seems to me for something to be the global reserve currency, the largest economy in the world would probably have to use it.

Because the largest economy in the world doesn't really care about any day-to-day market fluctuations or manipulations in the currency.

And doesn't the Chinese government watch their currency just a little too tightly, whether we're talking about the yuan or the petrolyuan, I just don't see it unseating the dollar anytime soon.

I feel like every few years I hear about something else that's going to unseat the dollar.

And here we are.

I wonder how much of all of this is shaped by propaganda. You guys in Asia say you keep reading stories about this. But I do a Google search, and I only find a handful of stories going back four years. (To be clear, I'm suggesting there's propaganda on both sides).

It's interesting to get your perspective. Challenges my bubble a little bit.

But with the United States pulling out of wars in the Middle East and Afghanistan, and pulling manufacturing out of China to bring it to North America, I think we're finally starting to clean up our house.

And if we clean up our house, the dollar is just going to be stronger. We're getting leaner and meaner over here.

Is some new idea really going to take this over? I thought maybe the Euro had as good a shot as any. Doesn't look like it anymore...

 

[Kevin88660]

I will just throw out that I am nowhere close to an expert on this subject. But I have to ask...

Would it?

Or would outflow exceed inflow and capital flee to the US? That's what happened the last time China got a little loose in its policy, right? And that's why they closed the doors again.

Idk... Seems to me for something to be the global reserve currency, the largest economy in the world would probably have to use it.

Because the largest economy in the world doesn't really care about any day-to-day market fluctuations or manipulations in the currency.

And doesn't the Chinese government watch their currency just a little too tightly, whether we're talking about the yuan or the petrolyuan, I just don't see it unseating the dollar anytime soon.

I feel like every few years I hear about something else that's going to unseat the dollar.

And here we are.

I wonder how much of all of this is shaped by propaganda. You guys in Asia say you keep reading stories about this. But I do a Google search, and I only find a handful of stories going back four years. (To be clear, I'm suggesting there's propaganda on both sides).

It's interesting to get your perspective. Challenges my bubble a little bit.

But with the United States pulling out of wars in the Middle East and Afghanistan, and pulling manufacturing out of China to bring it to North America, I think we're finally starting to clean up our house.

And if we clean up our house, the dollar is just going to be stronger. We're getting leaner and meaner over here.

Is some new idea really going to take this over? I thought maybe the Euro had as good a shot as any. Doesn't look like it anymore...

The doomsday “porn” started in the 80s when people are crying over twin deficits in U.S.

So actually this financial “judgement day” concept started out as U.S. cultural concept that is exported to the outside world.

It reached its peak at 2011 when gold price reached all time high. The doomsday financial blogs are anticipating inflation getting out of control, which didn’t happen until much later recently.

There were actually rumors about other countries building back up dollar alternative plans with currency swaps agreement. This can back as far as ten years back. The currency swaps agreement can be found online as they are public announcements. Back it wasn’t done in a high profile way. There was no public acknowledgement that “this is a backup plan to replace dollar transaction” even though it is.

The crux of the issue if China is willing to open up its capital market. For instance currently If I am bullish on China I will open a position in FXI etf in NYSE. I need to convert my SGD to U.S. dollar , which is kind of funny and awkward for China who claims to dethroning the dollar. Investing in China hasn’t been convenient and direct for people outside the country.

 

[Kevin88660]

Macron seeks China's help on Ukraine, Xi 'willing' to call Zelenskiy

China's Xi Jinping expressed willingness to speak to Ukraine's President Volodymyr Zelenskiy, the head of the EU said on Thursday, after French President Emmanuel Macron urged Beijing to talk sense to Russia over the war in Ukraine.

www.reuters.com

Macron and Xi’s Guangzhou rendezvous a sign of China’s enthusiasm, analysts say

In a rare meeting outside Beijing, the French president will reunite with his Chinese counterpart, as well as talking to investors and taking questions from university students.

www.scmp.com

 

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[Prdgy]

Whenever there is a shift in the global reserve currency, the new challenger usually needs to come in with some form of backing with complex assets such as energy or precious metal, and leads to their rapid price appreciation.

Watch out, America: China and Russia are stockpiling gold

This could be the start of those countries’ attack on the dollar.

www.marketwatch.com

Yeah I knew I remembered something from way back about Russia and China stockpiling gold, they've been doing that for a few years now, so maybe they're bringing the gold standard back? I'd actually be kind of excited for it if that's the case.

 

[Kevin88660]

Watch out, America: China and Russia are stockpiling gold

This could be the start of those countries’ attack on the dollar.

www.marketwatch.com

Yeah I knew I rememberd something from way back about Russia and China stockpiling gold, they've been doing that for a few years now, so maybe they're bringing the gold standard back? I'd actually be kind of excited for it if that's the case.

Exciting but also dangerous.

Probably need to have some stored food, bottles of water, and weapons (legal only), depending on where you are. No harm being a little bit more paranoid.

Major currency depreciation lead to massive imported inflation. If things get too bad there might be SHTF moment in the surrounding.

 

[Prdgy]

Exciting but also dangerous.

Probably need to have some stored food, bottles of water, and weapons (legal only), depending on where you are. No harm being a little bit more paranoid.

Major currency depreciation lead to massive imported inflation. If things get too bad there might be SHTF moment in the surrounding.

I doubt that that would happen, threats to the global economy have come and gone before, and this doesn't seem that extraordinary. Then again, banks said the same thing in 2007 about housing...

I don't think we're going to see some replacement event of the dollar but some more competition would actually be kind of healthy. If RMB can become just as influential as the USD and EUR then you might actually have a reason to invest in forex. This could actually be good for the dollar, ironically.

But do keep in mind with everything I say here that I'm fairly ignorant to recent currency trends.

 

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[MJ DeMarco]

I have a thread on petrolyuan under investment section. Might we could merge them instead of having multiple discussion here and there.

Thread merged.

 

[Kevin88660]

Joe Biden has plans for us lol. Discuss. How does this affect most people let alone fastlaners who have made it?

If there is a significant U.S. dollar depreciation against foreign currencies, those easy paths such as “make half a million dollar in U.S. and retire in Thailand” kind of paths might be severely affected.

It will also hit dollar denominated assets. The FIRE community who relies on “S&P always go up” will find their retirement plan further set back by a decade or more.

 

[Guest-5ty5s4]

US not looking good.

That doesn't mean China is looking good, either. I wouldn't want to invest there.

 

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[BizyDad]

US not looking good.

Why?

 

[Guest-5ty5s4]

Why?

The factors that are commonly used to rank countries economically - debt, inflation, political stability, public approval, birth trends, immigration and emigration... There are quite a few headwinds right now. They can be turned around but at the moment there are just so many negatives... It's not positive. We really need good people with experience and skill to get more involved...

 

[MJ DeMarco]

Why?

Because US leaders play the short-game, like children playing checkers. China plays the long-game, like adults playing chess.

The end result is a foregone conclusion, the question is, when and what is the damage.

 

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[BizyDad]

debt, inflation, political stability, public approval, birth trends, immigration and emigration

Because US leaders play the short-game, like children playing checkers. China plays the long-game, like adults playing chess.

The end result is a foregone conclusion, the question is, when and what is the damage.

True. But everything is relative. We printed a lot of money. China printed more. We have inflation. Europe has it worse.

At the end of the day, we make all our own food, can supply all our own energy needs, are bring back manufacturing for key industries either directly within our borders or to Mexico so efficiencies will be achieved, and other than a nuclear attack, we don't face military threats on our borders.

Meanwhile, Europe has to deal with a war, most of the world will be dealing with Russian oil going offline, Russian and Ukraine food, fertilizer, and mineral exports going to 0/next to nothing. South/Southeast Asia have to deal with an increasingly bellicose China who had their access to high end semi-conductors turned off, amongst other issues they face.

China plays the long game? Maybe. Do you think perpetual lockdown was the right way to handle COVID? With manufacturing ground to a halt, they lost a lot of foreign investment, never to return. And many countries are defaulting on their belt and road loans. So maybe they just aren't that good at the game either.

With respect MJ, that wasn't really an answer. That was not unlike the kind of fearmongering US politicians engage in.

I think Russia has more to fear from China than we do.

On top of all that, we still have the world's most powerful navy. So the Philippines, S Korea, Japan, Australia are all lining up on "our side" of the coming world order while maintaining varying degrees of self direction.

Or at least that is what the propaganda I see would have me believe. Again, I am not an expert and do not claim to see what other people claim is obvious.

Ask me about small business, I know a lot. Ask me about global economics and I'm on this thread to learn. I'm hoping people can counter the narrative I've been seeing. Or perhaps folks in other countries can confirm what my largely American perspective sees. I have a bubble. The bubble makes sense to me. What am I missing?

 

[Kevin88660]

Why?

Most glaring issue is public debt. 30 trillion debt for a 300m population. That is 100k of liability per person.

In Singapore if the sovereign wealth funds and excess foreign currency reserve are liquidated and distributed to each person it would be approximately $100k too.

 

[Guest-5ty5s4]

True. But everything is relative. We printed a lot of money. China printed more. We have inflation. Europe has it worse.

At the end of the day, we make all our own food, can supply all our own energy needs, are bring back manufacturing for key industries either directly within our borders or to Mexico so efficiencies will be achieved, and other than a nuclear attack, we don't face military threats on our borders.

Meanwhile, Europe has to deal with a war, most of the world will be dealing with Russian oil going offline, Russian and Ukraine food, fertilizer, and mineral exports going to 0/next to nothing. South/Southeast Asia have to deal with an increasingly bellicose China who had their access to high end semi-conductors turned off, amongst other issues they face.

China plays the long game? Maybe. Do you think perpetual lockdown was the right way to handle COVID? With manufacturing ground to a halt, they lost a lot of foreign investment, never to return. And many countries are defaulting on their belt and road loans. So maybe they just aren't that good at the game either.

With respect MJ, that wasn't really an answer. That was not unlike the kind of fearmongering US politicians engage in.

I think Russia has more to fear from China than we do.

On top of all that, we still have the world's most powerful navy. So the Philippines, S Korea, Japan, Australia are all lining up on "our side" of the coming world order while maintaining varying degrees of self direction.

Or at least that is what the propaganda I see would have me believe. Again, I am not an expert and do not claim to see what other people claim is obvious.

Ask me about small business, I know a lot. Ask me about global economics and I'm on this thread to learn. I'm hoping people can counter the narrative I've been seeing. Or perhaps folks in other countries can confirm what my largely American perspective sees. I have a bubble. The bubble makes sense to me. What am I missing?

The United States has had the tremendous advantage of printing the world's reserve currency for almost a century now. If that privilege is lost, it could change everything.

The currency is a fiat currency, like all other currencies. You are right that every country is in the same boat. However, losing that status is not the same as all other countries, because that means going from a place of enormous power to a place of being the same as everyone else.

Like toppling a giant... not great for our position...

Being a fiat currency also means that the main things backing the country are ability to repay through taxes, more debt, firepower/might, and general stability. Recent events show that our leadership and political situation at home are ... less than ideal or stable.


China and Russia are allies right now.

You don't need a PhD to read books and learn things.

Btw, I am pro-United States, I am just saying what I've read and researched from my best attempt at being unbiased. It does not make me happy to say that things look a bit sour.

--
All that being said, I don't think the Yuan is the biggest concern (one world government, digital currency, those are my biggest concerns), I am NOT claiming to be an "expert," I am not making any "solid" predictions about the future, just sharing my opinions and guesses that are nearly worthless really. Hopping on a very interesting thread, and hoping that things turn around for a great country I call home.

 

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[EmotionEngine]

Something I saw on Twitter since people are freaking out. Not sure it will take 30 years in the modern era but it won't be tomorrow.

 

[Guest-5ty5s4]

Something I saw on Twitter since people are freaking out. Not sure it will take 30 years in the modern era but it won't be tomorrow.

View attachment 48201

What I'm most curious about, is how to prepare for de-dollarization.

Like I said in my prev. post, my (mostly worthless W.A.G. of a ) prediction is not that the Yuan or some other currency will "replace" the dollar, but rather that Fedcoins or some other globalist digital currency will.

 

[Kevin88660]

What I'm most curious about, is how to prepare for de-dollarization.

Like I said in my prev. post, my (mostly worthless W.A.G. of a ) prediction is not that the Yuan or some other currency will "replace" the dollar, but rather that Fedcoins or some other globalist digital currency will.

Hedge against import inflation. Because if Dollar appreciates against foreign currencies, everything not made in U.S. will be more expensive.

 

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[socaldude]

Why?

The back door in the US was left wide open. "Gotcha" will be the famous last words. A lot of what seems a$$-backwards being done in the US, I think is actually a clever strategy/agenda by a small group of people.

We are a country that has politicians who don't represent the average citizen and won't stop selling us out for bottom dollar and full of entities that won't stop stealing anything nailed to the floor.

Our country doesn't produce anything. No one wants to work. People are just looking to game the system for free money. We have unlimited 3rd world immigration masquerading as Ellis Island. Our citizenry is obese and misinformed.

It's just a matter of time before the party's over and the invoice is due and everyone makes a run for the exit.

I've lost all faith in America. The government, the economy, it's institutions and it's citizenry/democracy.

 

[BizyDad]

I think Russia has more to fear from China than we do.

China and Russia are allies right now.

Allies of convenience. This is like saying Mexico and the US are allies right now.

Sure. True.

But there is a big brother little brother, don't-you-dare-even-think-of-crossing-me-because-you-need-me-more-than-I-need-you, tone to these "alliances".

Everyone is concerned China will push towards Taiwan. But what if China pushes towards the oil in Russia? Russia is a pariah now. Military being weakened. Who in the world would step up to rally around Russia if China makes such a move for the sake of their national interest?

Now that would be playing chess, not checkers.

What I'm most curious about, is how to prepare for de-dollarization.

Like I said in my prev. post, my (mostly worthless W.A.G. of a ) prediction is not that the Yuan or some other currency will "replace" the dollar, but rather that Fedcoins or some other globalist digital currency will.

People are already decrying the amount of energy it takes for bitcoin to exist. Imagine the energy it would take, and computer processing power required, to manage a world wide clearing house for an electronic currency. The same globalists that want a carbon tax will push for electronic currency? I find it hard to believe. Maybe they are pshing for more efficient alt currency tech, at which point maybe you are right and I am naive. I just haven't heard anything like that.

And how would take be an improvement over the current system? The current dollar based system is basically electronic. This would require "the world" to agree. But world unity has peaked, and we are re-entering a phase of factionalism again.

We have unlimited 3rd world immigration

Exactly. We are still the place people want to come to. Sometimes they are disappointed when they get here, but we have it SO EASY in this country our men want to become women and our women think they can be men.

No one ever dreamed this is what "pinnacle success" would look like, but here we are.

We are a country that has politicians who don't represent the average citizen

When has this ever not been true? Politicians do have to look at things more than just the concerns of the common man, which is why most actions taken by them were unpopular in their time. Even our own revolution was instigated by a minority opinion which fomented resentment until a movement was built.

Our country doesn't produce anything.

Except our own food, oil, technology, military hardware, software, spaceships, cars, and soon in my state, high end semi-conducters. Shoot, we are even re-shoring textiles.

No one wants to work.

The Japanese don't even have people to work. They use robots. So can we.

People are just looking to game the system for free money.

I refer you to every era in history.

makes a run for the exit.

To where exactly? Australia and New Zealand don't want us. Europe has many things worse than here. Anyone that wants to leave, go. I say bring in the immigrants that do all the grunt work anyway and let their children re-invigorate this country.