Overuse of sanctions by the US could discourage other countries from transacting in the Dollar in the first place, a risk that US officials are well aware of. Former Treasury Secretary Jacob Lew said in 2016 that the US “must be conscious of the risk that overuse of sanctions could undermine our leadership position within the global economy, and the effectiveness of our sanctions themselves… if they excessively interfere with the flow of funds worldwide, financial transactions may begin to move outside of the United States entirely—which could threaten the central role of the US financial system globally.” Similarly, former US Secretary of State Henry Kissinger said in 2014: “I do have a number of problems with the sanctions [on Russia for its annexation of Crimea]. When we talk about a global economy and then use sanctions within the global economy, then the temptation will be that big countries thinking of their future will try to protect themselves against potential dangers, and as they do, they will create a mercantilist global economy."...
The operative word above in "mercantalist." Mercantilism. In the past, the wealth of a nation was assessed by the amount of monetary gold/silver it held, that is, gold/silver derived from international trade. Silver has largely lost its value as a monetary reserve but not gold.
While Russian Central Bank head Elvira Nabiullina denies that a commodity-based ruble is under discussion or a return to the gold standard, facts show otherwise. Sergei Glaziev's (also transliterated as Sergey Glazyev) star is rising while Nabiullina is under attack as a neoliberal enabler, although Putin just appointed her for another term.
China has been considering an SDR system (the IMF has already added the RMB to the basket of currencies) and also a fixed rate system anchored by a basket of commodities including gold, which are somewhat similar to the bancor proposal of J. M. Keynes at Bretton Woods in contrast to the dollar system fixed to gold that was adopted and which Nixon abandoned in August, 1971, when international trade became based on a floating dollar. This system is now under duress after the dollar was weaponized.
The fall of the dollar as the world's reserve currency would be inevitable if multipolarism were to prevail. The US and its allies are committed to preserving unilaterism under a Western-dominated "rules-based order" and Western economic, financial and military dominance. This is now coming to a head and will be determinative historically going forward.
Zero HedgeGoldman Warns 'Dollar Dominance On A Downtrend'
Tyler Durden
https://www.zerohedge.com/markets/goldman-warns-dollar-dominance-downtrend
The Empire and the Dollar
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