Via the AP: Trump threatens 100% tariff on the BRIC bloc of nations if they act to undermine US dollar.
President-elect Donald Trump on Saturday threatened 100% tariffs against a bloc of nine nations if they act to undermine the U.S. dollar.
His threat was directed at countries in the so-called BRIC alliance, which consists of Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Iran and the United Arab Emirates.
Turkey, Azerbaijan and Malaysia have applied to become members and several other countries have expressed interest in joining.
Of course, such a threat is nonsensical but will be hailed by MAGA sycophants as a brilliant opening move in arting the deal, or something.
While the U.S. dollar is by far the most-used currency in global business and has survived past challenges to its preeminence, members of the alliance and other developing nations say they are fed up with America’s dominance of the global financial system.
The dollar represents roughly 58% of the world’s foreign exchange reserves, according to the IMF and major commodities like oil are still primarily bought and sold using dollars. The dollar’s dominance is threatened, however, with BRICS’ growing share of GDP and the alliance’s intent to trade in non-dollar currencies — a process known as de-dollarization.
The sad, frustrating irony is that the biggest threat to the dollar’s dominance is Trump and his foreign policy. One of the main reasons the dollar retains its position is deep global trust in the stability of the US government and economy. Moreover, the general approach to the global liberal order in terms of trade has been a hallmark of the post-WWII era and has largely been consistent regardless of who is elected to the presidency. Trump’s first election was seen to be an anomaly that might be dismissed like a hundred-year flood. His re-election, however, has created a great deal of long-term anxiety across the globe in terms of whether the US will remain a stabilizing superpower rather than simply acting like one of several great powers.
Indeed, constantly threatening tariffs is a great example of this new unpredictable, unstable global environment that will help hasten some countries to accelerate their desire not to be so tied to the dollar.
I continue to think that one of the most remarkable self-owns of the MAGA movement is that their desired foreign and trade policies will make America less great and less powerful.
