pull down to refresh
7 sats \ 3 replies \ @TomK OP 29 Dec 2024 \ parent \ on: SWIFT Proves Massive Dollar Dominance charts_and_numbers
Yes, I know. But why is China issueing usd bonds?
No idea.
You tell me.
edit- It could be because China is careful to remain inside the USD SWIFT system while it is still dominant even while China builds its alternative. Hong Kong provides an important window into the US/SWIFT system and also provides the perfect position from which to reverse engineer the monetary imperialism that was imposed from 1840.
Why are you treating SWIFT data as reporting the total trade volumes and settlement volumes when an increasing volume is not occurring via SWIFT?
One thing is sure China is in no hurry- it is careful to 'save face' for the declining US position, but is also steadily building its alternative trade payments routes.
reply
The world needs dollars to roll usd den. massive debtband its problrmatic after the Fed rose rates. The eurodollar market ist the world's big credit pump. I think You underrate the dominance of the us financial market. There is a lot of brics propaganda in circulation that got me from time to time too. We need more rational analysis without emotion
reply
Yes USD is still dominant but trade outside its SWIFT hegemony is increasing.
Do we have the data for that trade? Mostly no.
US hegemony is now heavily reliant upon its legacy USD dominance and the seigniorage and interest income that provides. That legacy was built upon US trade and military dominance post WW2. US retains conventional military dominance but China is working on that.
China is in no hurry but equally via Iran and Russia it is demonstrating it can settle trade with USD/SWIFT sanctioned nations outside of SWIFT channels - and the Saudis and others are not blind to this.
China now sources most of Irans and Russia energy exports, at a discounted price, with the bonus that that trade funds wars with US allies, imposing huge cost upon the US military...while China also enjoys quasi captive markets for its exports to Iran and Russia.
Sun Tzu would approve.
US power is based upon and dependent upon USD monetary hegemony.
S.Korea, Japan, Canada, Australasia, Europe and UK are all monetarily and militarily subservient tribute states to the US.
But China has won the trade war- all nations must trade with China or suffer because China offers the best commodity prices and provides the lowest cost consumer goods.
The West, even Japan, cannot compete with Chinese manufacturing.
Historically and logically trade dominance results in monetary dominance.
reply