Former U.S. Congressman and Libertarian Party member Ron Paul addresses recent events have dictated a weakening of the U.S. dollar’s influence as a reserve currency in international markets. Paul believes that even if that happens, it will probably take longer than some predictions are saying.
Ron Paul analyzes the collapse of U.S. dollar hegemony
in the latest edition of his onlinewebcastThe Ron Paul Liberty Report, former United States Representative Ron Paul analyzed the status of the U.S. dollar as a reserve currency and how current events involving China, Russia, Brazil, and others are threatening this status.
Paul said that he believes that even if the US dollar is eventually retired as a reserve currency, it will take longer than some currently published forecasts. On this he said:
People have been talking about this for a long time, but surprisingly, it is always longer than some predictions; someone in 1930 might have said that a Fed-controlled dollar standard would not last long, but that is not the case. It is very difficult to predict the exact timing.
He went on to explain that the dollar went through various phases, mainly the abandonment of the Bretton Woods system by former President Nixon, and told the audience that even then, the dollar had become an inflationary currency with no backing,” signaling its demise.
The Consequences of Having a World Reserve Currency
Paul explained that while holding his currency as the world’s reserve currency has advantages for the United States, it also has drawbacks. Paul declared:
It gives us license to inflate. It gives us license to interfere in the market with sanctions. It gives us license to fight wars we should not fight.
For Paul, the dollar’s demise began with the creation of the Federal Reserve System, which has license to manipulate the nation’s monetary policy without Congressional approval. However, Paul believes the acceleration has been accelerated by recent moves by countries to abandon the dollar as a trade currency.
There are signs that something big is happening. It has to do with China, Brazil, and Russia. It has to do with China, Brazil, and Russia. They have their hands tied against us. If they succeed, people will find a scapegoat, but that is not true. We have to look at monetary policy more honestly.
What do you think of Ron Paul’s stance on the dollar collapse? Let us know in the comments section below.
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