An interesting interview with Janet Yellen was released by CNN earlier, where she’s asked not only about the Russian sanctions and their putative effect, but on the current hot-topic issue of the global de-dollarization as a consequence of those sanctions.
Firstly, it must be acknowledged that there have been certain hits on the Russian economy recently. But they aren’t so much a product of the sanctions as everything in general, most notably the war expenses which have obviously ballooned Russia’s federal budget, as well as the global economic malaise.
With that said, Russia is spending far less on the war than the U.S. is. Of course, that’s not saying much, since the U.S. has far more to spend in its ‘unlimited’ coffers—but it puts things in perspective somewhat.
The second part of the interview was the most interesting. A shaky-voiced Yellen hems and stammers through the question of de-dollarization. She serves up a vapid boilerplate response, but judging by the tremor in her voice, the U.S. Treasury and the elites in general are shaken up.
She admits that ‘weaponizing’ the dollar has led to countries wanting to back out of it, but then disingenuously names only Russia, China, and Iran as the culprits.
Oh, but if it were only so!
She’s clearly posturing here—or she’s much more senile and out of touch than she appears—which would be saying something. Recent news shows a swath of global power players all positioning themselves into the de-dollarization camp.
Not only has Brazil’s Lula recently called for BRICs to develop their own internal currency, but the Commercial Bank of China has even processed its first ever cross-border Yuan payment in Brazil recently.
The Industrial and Commercial Bank of China (ICBC), has processed the first cross-border yuan settlement in Brazil at its local branch there, “marking another significant step in the yuan's globalization.”
The transaction became the first of its kind since China's Central Bank authorized the ICBC as a yuan clearing bank in Brazil in February.
The Sputnik article also mentions the Yuan surpassing the Euro in Brazil’s exchange reserves:
A recent survey report by the Central Bank of Brazil showed that as of the end of 2022, the proportion of the yuan in Brazil's international exchange reserves had reached 5.37%, exceeding the proportion of the euro at 4.74%, which means that the yuan becomes the South American country's second-largest reserve currency.
And highlights the growth of Yuan usage: United Arab Emirates settled their first energy deal by way of Yuan with China. Iraq’s central bank began to allow settlements in Yuan. Mexico, meanwhile, has now shown interest in utilizing Russia’s MIR payment system, which is Russia’s SWIFT replacement.
Yellen’s predecessor at the Treasury Secretary post, Larry Summers, has recently sounded the alarm on these developments when he warned that “America is losing global influence as other powers form trading blocs.”
In a new interview, he went on to say some more interesting, and revealing, things:
“There’s a growing acceptance of fragmentation, and – maybe even more troubling – I think there’s a growing sense that ours may not be the best fragment to be associated with.”
He does go on to hedge his alarm with the standard imperial justification that ‘the U.S. remains on the “right side of history”’. However, revealingly, he goes on to conclude that this ‘right side’ is beginning to look increasingly ‘lonely’:
“We are on the right side of history – with our commitment to democracy, with our resistance to aggression in Russia,” Summers said. “But it’s looking a bit lonely on the right side of history, as those who seem much less on the right side of history are increasingly banding together in a whole range of structures.”
What a fascinating acknowledgment! Imagine the mental leaps you have to take to believe you’re on the right side when you’re now in the global minority?
American Thinker magazine’s new article encapsulates this:
The West’s sweeping sanctions on Russia following its invasion of Ukraine are shaping up to be the West’s most monumental miscalculation in modern history. The sanctions have not brought the Russian economy to its knees, as was widely predicted. Instead, it’s the Western economies that are reeling, their economic growth all but stopped. Many of them are simultaneously suffering from both high inflation and energy shortages.
One of Yellen’s main bragging points was that the U.S. sanctions have effectively squelched Russia’s ability to supply weapons to its army. But there are a number of recent charts and data-points that show how successfully Russia has subverted not only the sanctions in general, with substitution towards the east, but the so-called ability to supply weapons.
For instance, here is Russia-Indian trade:
This new Reuters article has Ukraine bemoaning how many new Russian weapons systems are now found with Chinese parts in them, rather than Western parts:
And as I’ve mentioned in a previous article, for those who believe having Chinese parts in Russia’s weapons is such a huge weakness, please tell me what it means for the U.S. military that the F-35 supply chain looks like this:
The same goes for many other American weapons systems.
And today’s biggest headline is that Russia’s inflation has staggeringly dropped down to ~3% from a recent 11%, and a high of nearly 18%:
Even the Western-funded Russophobic Moscow Times was forced to report the news.
For comparison, UK is currently at over 10.4%, Italy 7.6%, Germany 7.4%, France 5.4%, U.S. ~5%. Most of the other secondary European countries are even much higher, still in the 12-20% inflation range.
So Russia’s 3% and change is nothing short of miraculous. With that said, even Russia’s central bank said this drop is temporary and that the inflation is said to rise to about 5% and stabilize there in the coming months.
All in all, the CNN interview with Yellen proves two things. One: that de-dollarization is taking shape to such a large degree that even the worthless corporate media is finally forced to acknowledge it, rather than the petty dismissiveness with which it has treated such developments in the recent past. Here, CNN’s mouthpiece actually looks and sounds outright worried as he begs Yellen for some measure of reassurance that their beloved Dollar is not so doomed as it looks.
Secondly, in the interview Yellen nervously acknowledges that de-dollarization is happening, which is a major milestone in and of itself. But she tries her hardest to dismiss the severity of it by deceitfully downplaying how widespread it truly is becoming, to the point where it’s now the talk of the globe. She tries to ‘sell us’ on the dollar’s strengths by basically giving what amounts to a cheap Federal Reserve PR pitch about the dollar’s unparalleled liquidity and the ‘depth’ of U.S. treasuries and capital markets—though she hardly makes it through the charade without stammering herself half to death.
Ultimately though, in answer to the question about the end of dollar hegemony, her greatest selling point relies on the idea that the ‘allied partnerships’ which stand behind the U.S.’s weaponization of its currency are what will assure the dollar’s continued dominance. But the critical flaw in her reasoning is that in the interviewer’s very question itself was the mention of France’s Macron being one of the powerful blue-team figures who recently fueled de-dollarization worries with his statement, after meeting President Xi, that Europe and France should ‘reduce reliance on the U.S. dollar.’
That is quite the shaky foundation Yellen chose to premise her ‘reassurances’ on!
If your main argument for the dollar’s strength is that it’s backed by allies, yet one of your foremost allies is the one pushing de-dollarization ideas, well then…
Ultimately, her own predecessor Larry Summers undercut her point with his much sharper admission when he too referenced the ever-shrinking moiety of ‘partners’, who are supposed to represent the dollar’s unshakable bedrock, in relation to the rest of the world:
“…It’s looking a bit lonely on the right side of history, as those who seem much less on the right side of history are increasingly banding together in a whole range of structures.”
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Janet Yellen Stammers Through De-Dollarization Defense in New CNN Interview