The situation in the Crimea remains roughly unchanged, and US officials continue to ratchet up threats to impose sanctions on Russia, saying they are determined to punish Russia for its involvement in the Ukraine.
Russian officials are warning that sanctions are a two-way street, however, with the Foreign Ministry saying that they would “have to respond” to any US sanctions, though their preference is to not engage in such moves.
Top Putin aide Sergei Glazyev went into more detail about what this might look like, saying that any asset freezes would be met with reneging on loans giving to Russian institutions by US banks.
Glazyev went on to warn that if a sanctions war picked up, Russia would ditch the dollar as its currency of choice, and would “reduce to nothing our financial dependence on the United States.”
The Russian Bear bites back.
If Russia ditches the dollar they can trade with Iran on a barter basis. Oil for Arms and technology
That should put the cat amoungst the pidgeons (hawks)
Turn off Euro gas and Oil and how quick will the sanctions fall in a heap. OIL and gas Prices spike in the US, let alone NO gas in Europe where it is still Winter!
Do the Europeans pay in Euros for Russian gas?
The US has developed sanctions using its unique position until now a Senator boasts sanctions are now a weapon that can "crush any national economy."
Any nation must therefore see that threat, and take steps for its own security to counter that threat. That is the nature of weapons and warfare, attack and defense developing in reaction to each other.
It is only to be expected that a well developed national security team will have developed some defense ideas to counter such economic warfare. From what the Russians are saying, they have.
That does not mean the defense will work. That remains to be seen. It does mean that it is not one sided, a cake walk. That only happens the first times, before a defense evolves.
A larger issue arises, beyond the immediate contest. By turning the US commercial position into a weapon, the US makes its commercial position a threat, something that must be countered by other nations as a matter of national security. They will. That will inevitably hurt the US commercial position in otherwise peaceful pursuits.
Already we see that as the EU, Russia, and China all develop their own satellite systems for navigation and time keeping, instead of using our very good ones. We can expect to see more of that, as the US is driven out of markets by national security establishments that see as threats the US commercial positions in banking, insurance, sales, electronic devices, networks, everything in which we lead and which we could use to our advantage with sanctions.
Yes, that is a direct threat to the dollar, and to the special privileges we get from printing the international reserve currency.
The blow back here is seen everywhere but in Washington DC, as is too often the case.
Ditch the dollar as the currency of choice? Any guesses as to which currency they would adopt? How about the Estonian currency?
Euro, Yuan, many choices.
China, Russia and other countries like Brazil and India had already discussed ditching the dollar as the international currency on previous occasions. As China is on a par with the United States economically and surpasses the US in trade, that would currency would be the logical choice.
When you start messing with countries with similar military and economic clout, any trade wars or sanctions will not be one-sided, like they were with Iraq and Iran.
Ditch the dollar as the currency of choice? Any guesses as to which currency they would adopt? How about the Estonian currency?