De-Dollarization: Is The World Fed Up With The U.S. Empire?
Over the last 20 years, dollar reserves around the world have dropped from 73% to 47%. The world is clearly "de-dollarizing." Endless wars, sanctions, wokism, the questionable indictment of a former president, and a long list of unconstitutional abuses all appear to have turned off other nations. They are jumping ship and don't want to be a part of it. America was never supposed to be an empire in the first place. It's a century-old aberration. A return to a limited government that respects individual liberty is long overdue.
Over the last 20 years, dollar reserves around the world have dropped from 73% to 47%. The world is clearly "de-dollarizing." Endless wars, sanctions, wokism, the questionable indictment of a former president, and a long list of unconstitutional abuses all appear to have turned off other nations. They are jumping ship and don't want to be a part of it. America was never supposed to be an empire in the first place. It's a century-old aberration. A return to a limited government that respects individual liberty is long overdue.
Hello, everybody, and thank you for tuning into the Liberty Report.
With us today, Chris Rossini, our co-host.
Chris, good to see you today.
It's great to be with you, Dr. Paul.
Good.
And Chris, you've been a big help this week.
Our personnel has been in and out, but you've been around every day.
So that's great.
And so I won't have much to do today.
You're going to carry off the whole thing.
No, it's great to see you again.
And we believe that Daniel has had some family problems to deal with.
I think he's coming back this weekend and should be back in the office on Monday.
So we might not have to call Chris.
Chris, what are we going to do now?
Anyway, we're ready to go.
And Chris and I have decided we wanted to talk about the dollar and the reserve currency of the world, which we have in the past, because it's a big deal.
You know, there's a whole conflict and interest in the dollar for most people started in 1913.
What will the Federal Reserve do to the dollar?
Well, they've eliminated over 98% of its value compared to the value of a dollar back then.
So it's an ongoing process, and you can hardly think about dollar.
And we want to talk today about the liquidation of the change in the loss of the dollar as a reserve currency.
But you can't think about that without thinking about gold because they're interrelated.
I mean, when we talk about the dollar, we talk about $20 an ounce gold.
And then we go through the century of the manipulation.
But the ratio is very important.
And when people get together and start manipulating, they manipulate the dollar for the benefit of the bankers, but they also manipulate gold.
And it can get confusing.
It's one of the reasons why I became fascinated with gold very early on, even prior to the breakdown of Bretton Woods in 1971, because I found the story interesting.
And then as I studied it more, I found out, you know, the dollar and the gold and the Federal Reserve is very deeply involved in the manipulation of the welfare warfare state and how they can pull the wool over the eyes of the average American and say, oh, you're going to have a free lunch.
We're going to have a welfare state.
No problem.
We just put up the money.
But it hasn't worked out that way.
And the one way I watch it is the ratio that the market is telling us about gold and silver.
And it's very volatile, up and down.
The dollar's value on international markets goes up and down, and small events will have an effect, but also on gold.
It's the reason why I work with Birch Gold, because they do provide information.
And if you're interested in getting some free information from Birch Gold, you can text Ron at 989898, and they will send you some information to see if you want to get further involved with gold and get some explanations because that's very important.
But my goal has always been to understand the relationship of gold and silver.
And the one thing about the things that have generally been forgotten about money is we know by supply and demand.
Everybody knows about the rule of supply and demand.
If you have one product, supply goes up, prices go down, that sort of thing.
But it was not originally known.
And it was only the Austrians that really emphasized the fact that the supply and demand of money is also important.
So you have supply and demand of products and the supply and demand of gold.
And this is why preserving the value of dollars is difficult.
You know, if you have savings in dollars, the same way is what about the gold market?
It's something you have to keep up with because, you know, Roosevelt, the first thing he did when he wanted to introduce A whole new concept of economic policy.
The first thing he did was take all the gold from the American people.
So it is an important issue.
And once again, if you want to follow up and get some free information from Birch Gold, it's text Ron at 989898.
And now we, Chris and I, we'll talk a little bit about what we see coming because we don't have, you know, we don't have absolute insight to what's happening.
But generally speaking, if you follow Austrian economics, you're able to spot trends and values and change that occur.
What's difficult, of course, is predicting time and place because that involves a subjectivity of the people dealing with it.
So you may know that next year gold is going to be $3,000 an ounce, but you don't know for sure if it is.
And it may, you know, a year or so ago, it was $1,000, you know, and now it's $2,000.
So it involves a lot of people involved worldwide, people who own gold and people who own dollars.
And right now, our challenge, Chris, is to give us, give our viewers an opinion on first, I think most of them would agree there's trouble, there's trouble with the Fed and there's trouble with the dollar.
But the big thing is, is how do you predict when?
If we knew next week, one in seven days, there was going to be an event that people were going to panic and race out of the dollar, which quite frankly is a possibility, even though I'm not predicting that.
And I think it's not likely, but it could.
And that's the reason we want to talk about it, because there is an element, you know, when it comes to it, you know, everything from the economic conditions here, war in Ukraine, our budgets discussion.
War, Printing, and Defaults00:11:46
There's so many things that have a very definite effect on the value of the dollar and the value of gold.
Chris.
Yes.
And you spoke about trends and we noticed a trend.
We were reading an article, I think it was on Kitco, and talking about the dollar and its share of global reserves has plummeted.
It was 73% in 2001, which is not that long ago.
It dropped to 55% in 2021.
And then in 2022, it's down to 47%.
So in just 20 years, the dollar as a reserve currency has dropped from 73% to 47%.
That is a major shift.
And it's not surprising when you look at the last 20, 30 years of what the U.S. has done internationally.
It's an empire, unfortunately, and empires need partners.
And a lot of people around the world were involved with this.
A lot of outside people, the American empire is not just Americans involved in this.
You know, countries on the receiving end of all of our taxpayer money, A, they like that and want to keep that going.
Just like Americans like stimulus checks and want to keep that going and complain when it has to stop.
And if we are supposedly defending other nations, that means they don't have to defend themselves.
They can use their money for whatever else they want.
They don't have to worry about defense.
The Americans will take care of it.
The American taxpayer will take care of it.
So empires, and that's why it takes so long for global currencies to finally go kaput.
And they all do.
They're without exception.
What happens is people in the empire nation, they start overextending themselves.
They want to rule the world.
They want to spread wokeism.
They go into all these different directions that stretch everybody thin.
And eventually the rest of the world says, oh, whoa, we're not on board with all this.
And then they start to peel themselves away.
It first takes a few courageous ones to do it, bigger ones, and then the rest follow like dominoes.
And, you know, this 73% to 47% shows that the rest of the world has had enough of the American empire.
Very good.
And, you know, the conditions after World War II were conducive for the United States to pick up the role of issuing the reserve currency of the world because we had the military power.
We were essentially saved from the devastation of Europe and Asia over the war.
And we had most of the gold.
I mean, hundreds of tons of gold we had.
So we were very wealthy and we were a productive nation.
So it did make sense.
But they didn't go to a gold standard.
What they did, they went to a gold reserve standard.
They say, we'll, at the IMF meeting in 44, they say, what we'll do is we'll guarantee the dollar.
Anybody from a foreign nation would come and if you have a dollar, we're going to give you $35 an ounce.
And then everybody traded in gold.
Then later on, we made promises to Saudi Arabia that, you know, if you price your oil in dollars, we will guarantee your safety and security.
Those things have started to change because one thing is, is we live way beyond our means.
So even between 1944 and 1971, there were a lot of prediction that Bratton Woods was fake at $35 an ounce because we just were running the printing presses like crazy.
So common sense said, well, that's going to devalue.
That's going to lower the value of the dollar.
So in dollar terms, the price is going to go up and it's eliminating the value that counts.
It's not the price of gold so much.
So that was predictable in 1971.
And then to patch it up, of course, what we did was we had not been able to own gold as Americans.
And what they did then was they allowed, foreigners were still allowed to do that.
But by 1971, we didn't even have enough money to honor our commitment.
So in a way, it was a form of bankruptcy that we were declaring.
We were in 1933, when we took the gold away from the people, we were declaring that we intend to bankrupt ourselves with printing too much money.
That happened in 1971.
We quit fulfilling our promises that stabilized the world because people did believe that we would do it and follow through.
So we say we did that.
And it worked better than some would have predicted.
So that to me is a big thing.
But eventually, you know, the predictions have come true.
Can't work for a long time.
It's going to end.
And that's what we are seeing now because, you know, we keep saying, when's it going to end?
When's it going to end?
But Chris, I think you and I can agree.
And I imagine a lot of our viewers can agree.
Well, it's already starting, whether or not it's it, but it's not concluded yet, because it'll be concluded when others use the currency.
And that's what Chris was alluding to, that some countries are already doing it.
More and more, we have a series of countries that are transacting their international accounts in their own currencies and ignoring it.
But I think the big thing there is we have made a lot of enemies in the world.
And, you know, we put sanctions.
And if sanctions don't work on people obeying what we tell them to do in foreign policy, what we do is we bomb them.
And lo and behold, then we're using our money and we run up these deficits.
We're in the middle.
Once again, how are we going to keep ourselves from defaulting?
We have to raise the national debt, which I see as a force because we're defaulting on a daily basis.
If the value of the dollar is going down, that means you're getting cheap dollars.
And if you've saved your money in dollars, your value of your dollar is going down.
But the one thing is, if that continues, what has always happened, though, is the dollar value of gold goes up.
So it's one way a lot of people, including myself, we use that as a savings against this.
But we're in the middle.
We are defaulting.
So everybody talks.
It's just a technicality and language.
People will say, well, are we going to default?
No.
One party will say, you guys are going to default.
No, no, we will never default.
Well, they're defaulting all the time.
They've been doing it, especially since Roosevelt.
It's just it manifests itself in different ways.
But right now, it manifests itself by people now in a practical way, dealing with other currencies and groups of countries getting together.
And it's not insignificant.
It isn't just one or two countries.
So I think very definitely we have moved in the direction of accelerating our default.
And but the big fear is when is it that people throw in the towel?
They just throw it in.
I can't keep up with this.
And they're not going to save the day.
And so the stalemate that they have in Washington, which goes on every couple of years to raise the debt limit, that may precipitate it.
Or another foreign policy failure.
You know, one individual that would, Chris, you were giving out those statistics, what's happened in this past year.
And they said that was all because of Ukraine war.
And Ukraine war had a lot to do with it.
But I think it's bigger than that.
I think it's our deficits for all kinds of reasons.
I think it's the influence of wokeism, internationally wokeism, which has interfered with the soundness of our economy, but also the protection of our liberties.
Who knows?
Somebody could probably make a pretty good case and say, this whole problem is your judicial system in the United States, it's a wreck.
You can't depend on it, where at one time it was respected.
So there are a lot of factors involved.
But I think I would take the position, Chris, that the default is ongoing and it's not going to slow up.
It's going to get worse.
And we have to look not only at the value of the dollar each day, what we have to look at is the dollar-gold relationship.
Yes, very good.
And yes, our country unfortunately has made many enemies.
I mean, we could go back to even after 9-11, look how we attacked Iraq, who had nothing to do with it.
And a million people died for, you know, they had nothing to do with it.
You know, so it's not just the printing of money that has turned off other nations.
It is, I'm sure that it is our foreign policy, endless wars, sanctions.
I mean, we even sanction allies.
So even if you're an ally, you're not safe because you could be turned on at any time, even domestically.
I'm sure the world sees this.
That they're arresting a president that is running for re-election on amazing charges.
And the ideology of wokeness you mentioned, Dr. Paul, other countries, I'm sure, do not want to be invaded so that woke can be brought to them so they could be so enlightened.
They definitely do not want that.
In fact, half of our country doesn't even like it.
So it's not just the printing of money that has turned other nations off because they print money too.
So they're not, you know, philosophically against that, you know, look, America's printing all this money.
It's oh, look, America is just running rampant all over the world, and we could be next.
So they have to be working together, I'm sure, to be like, listen, we got to get out of this somehow.
And dumping the dollar, you know, down to as much as it is in just a few short decades shows that they're concerned and don't want to be a part of this anymore.
Very good.
A lot of people will call in and inquire and try to get my opinion on what is going to be the nature of the replacement.
You know, I don't really know.
And I don't think anybody else knows.
There's not the United States position that they had after World War II arriving right now because, you know, there's a group.
You say, well, maybe Russia can lead the right way.
And you could argue the pros and cons of that.
And you could argue about China.
And then you could argue as a group of countries.
We have to realize that we have no respect for gold at all.
Matter of fact, I think our government rings the gold price in order to make the dollar look stronger.
And they will continue to do that, which really confuses people on how to protect against it.
So that is what is happening.
And the dollar will respond.
And the market gives us a lot of information about what the governments are doing, more so than what the financial markets will tell us, you know, the people who are interpreted, because you can't know exactly.
But I'll tell you what, if a government debases its currencies, turns on the printing presses, have unlimited spending, and teach in a part of a philosophy that deficits don't matter and that you can save the world through environmentalism, printing money, wokeism, the whole works.
China's Gold Investment00:06:47
There's so many failed ideas.
And they don't talk about, well, maybe the problems can be solved with a good dose of liberty.
And I keep thinking that's what happened in 1921.
They had not accepted the politicians nor the economists had accepted the idea that the government had to do everything conceivable, but they had built a bubble after World War I.
And so the recession, depression, it actually was a depression.
The GDP crashed, but they were not conditioned to do the bailing out.
And, you know, and a lot of people lost a lot of money, but it only lasted a year because they still, they concentrated it on not bailing out and also to maintain a more balanced budget.
We didn't have wars going on like now, and we didn't have a welfare state.
In one year, you know, we got over it.
But eventually you have to liquidate the debt.
But we're already working hard at it.
I think the officials already knew that because even before these recent crises that we've been dealing with the last four or five years, you know, our Federal Reserve was saying, you know what we need?
We need to, prices aren't going up fast enough, but we need to aim for at least a devaluation of the dollar by a 2% price inflation rate.
Whoever heard of such nonsense?
But of course, when it hit two, you never saw it because it quickly went to 10.
And they're still embarked on that.
So it's the fallacy of economic policy, I believe, is the most significant thing, which occurred at the beginning of the last century.
And we're still obsessed with that.
So I think it's interesting now that we see China challenging us because they're investing the money they earned when we buy their stuff in the world.
At the same time, all we do is They invest the money there, and we just buy bombs and destroy the property they're building.
Doesn't make any sense, but it'll come to the end because this is not durable.
It can't last this way.
So, once again, I always go back to we have to concentrate on a better understanding of economics and how important how important the principle of liberty really is.
And I think basically is one of our dedications for this program.
Chris, yes, very good, Dr. Paul.
I'm going to give my closing thoughts now.
The way I see de-dollarization is that I believe the rest of the world is going through their own version of Trumpism.
You know, Trump symbolized here in this country a growing disgust with the way that the nation is heading.
And foreign nations cannot vote here, foreigners cannot vote here, but they can de-dollarize.
And that is that you want to hit the empire in the wallet.
That's where you do it.
This is all good in the long term for us and the world because we were not supposed to be an empire.
We're supposed to be a limited government republic with where individual liberty can thrive and flourish.
Empire is the exact opposite of that.
Our founding documents are very clear about that, about what this nation was founded upon.
But progressivism took over, and now we're seeing the results of it.
And the results are as bad as one would have predicted 100 years ago.
But as people here and people out there in the world abandon this idea of this American empire that's going to rule every inch of the earth, we have a chance to head in the right direction.
And libertarianism, conservatism, there is no perfect.
There will never be any perfection.
There will be problems in free markets.
There will be problems with individual liberty.
They will just be more localized.
They will not be where everybody suffers at the same time with centralization.
So we have a chance to head in the right direction.
And that's what life is all about.
Which direction are you heading?
If you're going the wrong way, turn around and head the right way, and you'll have a better life.
So, you know, as bad as all this stuff is, the future can be very bright.
And that's, you know, we hope that we make our little contribution to helping that happen.
Very good, Chris.
I'm going to close by making a statement, but it's not a prediction that I know this is going to happen.
But evidence shows that they've made progress, and that's the BRICS.
You know, the five countries that have come together.
One thing is, is they respect gold, they buy gold, and they're working together.
Malaysia was not part of the BRICS, but I find it interesting that China and Malaysia are getting together.
And then also China is more now in the position of the peacemaker than the warmonger, which I think also helps them.
So I would keep an eye on BRICS.
And if they continue or accelerate their purchase of gold, because yes, they can say they're going to do things like we have, but they have to be held to the feet to the fire because so often the government is almost always governments bend the rules.
And that is why eventually the best standard of money where you can define the currency and define a unit of account would be that it's easily convertible into something that you can measure and you can define.
And that is a coin, a coin that you could have.
It doesn't mean you have to have a coin for every transaction.
That's a fallacy.
That's not true.
But you want to measure every transaction and people can loan money to each other in a way, you know, how much are we going to do?
And as long as you know the definition and there's credit out there, just so the government doesn't have license to control, spin, run wars in the welfare state and think that they can run their empire, that is coming to an end.
And when the empire ends, it'll be, you know, it will be at the same time that the dollar is ending as well.
They may come together one on top of another.
So I think we live in interesting times, but very dangerous.
So I think the more knowledge and understanding we have, the better it is.
But I would still vote first for Liberty.
It just must solve most of our problems.
I want to thank everybody for tuning in today to the Liberty Report.