Jeffrey Tucker, a renowned author and publisher who has worked for former U.S. Representative Ron Paul and the Mises Institute for many years, has expressed his view on the growing de-dollarization trend and its effects on the U.S. economy. In an interview with NTD News on Wednesday, Tucker warned that the U.S. dollar is at a turning point, citing a growing de-dollarization trend. He explained that the U.S. has held dominance in the global currency market since 1944, which has enabled it to influence policies worldwide. However, referring to the attack and sanctions imposed by the U.S. government on Russia following the outbreak of the Russia-Ukraine war, he opined: “History will record that was the turning point for the dollar.”
Tucker noted that the BRICS countries (Brazil, Russia, India, China, and South Africa) are starting to “marginalize” the USD, and he stressed that it will affect the status of U.S. debt which could really restrain the Federal Reserve. The impact domestically is not going to be as pronounced as people might think. The big thing we have to worry about domestically is domestic de-dollarization, namely inflation. He stressed that inflation is “sticky,” adding: “It’s with us. It’s not going anywhere. The Fed hasn’t been able to reverse it.” He further noted that the USD has lost 15 cents of its value over the past two and a half years. “That’s inflation,” he exclaimed, emphasizing that it’s the “direct consequence of the Fed’s mismanagement.”
Tucker cautioned: “De-dollarization will affect us as we travel internationally. Right now, the dollar is basically gold anywhere you travel in the U.S. … That will definitely come to an end.” Furthermore, he said it will “also seriously hurt international business that’s domiciled in the U.S.” He concluded: The dollar’s just not going to be king. This isn’t going to happen tomorrow or next year or even the next five years, but looking at the long-term trajectory, I think we are at a turning point.
The U.S. dollar has been the dominant currency in the world since the end of World War II. However, with the rise of China and other emerging economies, there has been a growing trend towards de-dollarization. This trend has been fueled by a number of factors, including the U.S.’s use of sanctions as a foreign policy tool, concerns about the stability of the U.S. economy, and the growing use of alternative currencies such as the euro and the yuan.
The BRICS countries have been at the forefront of this trend, with China and Russia in particular taking steps to reduce their reliance on the dollar. China has been promoting the use of the yuan in international trade, while Russia has been diversifying its foreign exchange reserves and reducing its holdings of U.S. Treasuries. Other countries, such as Iran and Venezuela, have also been exploring alternative currencies in response to U.S. sanctions.
While de-dollarization is unlikely to happen overnight, it is a trend that is likely to continue in the coming years. This could have significant implications for the U.S. economy, including the value of the dollar, the status of U.S. debt, and the ability of the Federal Reserve to manage inflation. It could also have an impact on international trade and the role of the U.S. in the global economy.
In conclusion, Jeffrey Tucker’s warning about the turning point for the U.S. dollar should not be taken lightly. While the dollar is unlikely to lose its status as the world’s reserve currency anytime soon, the trend towards de-dollarization is real and could have significant implications for the U.S. economy and the global financial system. It is important for policymakers and investors to pay close attention to this trend and to take steps to mitigate its potential risks.
