The first lesson you learn in economics is there are always tradeoffs.
For instance, if your country announces it’s banning gas by 2035 it will force oil-producing countries to scramble in search of new alternative revenue streams.
Enter Saudi Arabia: they are breaking ties with the U.S. dollar and joining the China-led Shanghai Cooperation Organization, a massive trade bloc that trades in yuan.
Here’s the score if you aren’t keeping track:
- Crafting connections with China, a superpower rival to the U.S. ✅
- Creating a new financial system away from the dollar ✅
As their Crown Prince Mohammed Bin Salman recently told associates last year, “[we] are no longer interested in pleasing the United States.”
This is the biggest story of the year.
Was losing U.S. hegemony part of his plan?
Image from Wikimedia Commons
The free ride of the dollar is over. The world can’t sustain it.
Since 1933, the U.S. dollar has lost 92% of its domestic purchasing power. It doesn’t help that almost half of global trade is based on this volatile gumshoes system.
It’s led to events like the British pound flash crashing against the dollar and now fucking the UK economy beyond repair:
- Rampant inflation (10.4%), which the central bank is not controlling
- Daily strikes in the UK as people aren’t getting paid enough
- Real estate is overpriced for mostly everyone forcing them to rent for the rest of their lives
Lost access to the EU economy through Brexit
But it wasn’t just Biden; the entire U.S. financial system — that led to the crashes of 2008, 2020, and 2023 — was ignored by both parties.
Americans think in quarter-long windows and take military and economic supremacy for granted. Countries like Saudi Arabia, India, China, and Russia are looking at the long-term picture, figuring out ways to reduce their reliance on U.S. dollars.
Was it self-sabotage or hubris that got America to its current state?
I don’t know, mate. But we’ve squandered our advantage, and now?
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