Has the Biden Administration Started a Global Currency Crisis?
Here comes the worldwide scramble for gold.
This is big.
In his State of the Union address, President Joe Biden announced measures to make what he called Russia’s $630 “war fund” worthless.
“We are cutting off Russia’s largest banks from the international financial system,” said Biden.
There is no way to put it nicely. The Federal Reserve has confiscated Russia’s foreign currency reserves.
As with most acts in life, the important question is what the consequences will be. And not just the reaction of Russia which must make new and important decisions about energy and other vital resource commerce with the West.
Just as important is how the rest of the world will respond to the discovery that their US dollar reserve can be grabbed at any time. Influential blogger Michael Shedlock asks, “If the Fed can do this to Russia, who else?”
Shedlock points out that not only is the asset freeze unprecedented, it is also illegal. “Nowhere does the act give the Fed the right or power to confiscate the reserves of sovereign nations. But that is exactly what the Fed did.”
Will China with its huge dollar reserves fail to notice that they are in jeopardy without notice? Will it care that the US dollar has are now weaponized in a way that puts their trillion US dollar reserves at risk?
Will other foreign nations and central banks fail to notice?
Shedlock puts it this way:
Team Biden just sent an unmistakable message to China, Saudi Arabia, Russia, and, well, actually everyone:
We can make your fiat reserves worthless overnight
– Buy gold
– Buy base metals.
– Hoard things you have everyone needs.
That’s pretty good advice, but you don’t need to bother buying lead, zinc, and other base metals. In fact, the global base metals market is mired in scandal for the manipulation of markets and trades in nickel.
Gold is the world’s most liquid commodity, serving efficiently as money in good times and bad. Silver is in second place and has special price advantages since it is trading at half its prior highs.
In either case, the post-World War II monetary system is cracking up. Protect yourself by speaking with a Republic Monetary Exchange precious metals professional and taking sensible steps to reduce your exposure to a developing dollar crisis.