Another EEU nation preparing to dump dollars and other fiat currencies for gold

Another EEU nation preparing to dump dollars and other fiat currencies for gold

In just the past month, three EEU nations have embarked upon a process of dumping dollars, with two of them also increasing their gold holdings in preparation for a post-dollar world.

Earlier in June we discovered that last month's climb of the 10 year Treasury yield to over 3% was primarily due to Russia selling $49 billion of their dollar reserves.  Then just a few weeks later Belarus announced they were signing up with Russia to begin bi-lateral trade done outside the reserve currency.

Now on June 20th a 3rd Eurasian Economic Union (EEU) member has jumped into the mix by announcing their were dumping both their dollar and yuan reserves to instead purchase physical gold as their primary monetary protection.

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Belarus becomes next country bent on ditching the dollar as they seek bi-lateral trade agreements with Russia

Belarus becomes next country bent on ditching the dollar as they seek bi-lateral trade agreements with Russia

In the Russian Analyst’s opinion, this move is a direct counter to U.S. attempts to enforce the Countering America’s Adversaries Through Sanctions Act (CAASTA) against Russia and re-imposition of anti-Iranian economic measures. Since the collapse of the Soviet Union, a major source of revenue in Belarus has been the refining and export of Russian crude to Europe. Another source of Belorussian income has been supplying Soviet type arms and parts to Iran when that nation was still under pre-JCPOA sanctions.

With Washington putting the squeeze on EU refiners not to touch Iranian oil while giving ENI and Total just 90 days or less to comply, the Belorussians are well situated to profit from busting the U.S. sanctions. They can import by rail Iranian oil that doesn’t get processed in Russian refineries after its shipped up the Volga from the Caspian Sea. Of course, to do that, Minsk needs to be able to transact on a large scale without dollars. — JWS

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While the clowns come together in Quebec for the G-7 this weekend, real things are getting accomplished in Asia at the SCO Summit

While the clowns come together in Quebec for the G-7 this weekend, real things are getting accomplished in Asia at the SCO Summit

Nothing spells out chaos and turmoil better than the expectations this weekend for Western leaders at the G-7 conference in Quebec, Canada.

Even before arriving for the summit, European leaders have gone as far as to try to isolate the U.S. by calling the group the G-6 +1, with some like Emmanuel Macron threatening to stand toe to toe with President Trump over trade and tariffs.

However while it appears that the West has diminished to nothing more than a three ring circus, over in Asia real work is getting accomplished at the Shanghai Cooperation Organization (SCO) summit which is scheduled to also meet this weekend.

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Russia Continues To Take a Wrecking Ball To The US Dollar

Russia Continues To Take a Wrecking Ball To The US Dollar

Informational attacks on Russia as an aggressor nation supposedly using Zapad2017 military exercises to simulate an invasion of the Baltics and Poland or guilty of hijacking the 2016 U.S. elections via Facebook/Twitter trolls and bots are intensifying. Hollywood directors and actors like Morgan Freeman are being enlisted into propagandizing the American public with the notion that 'we are at war' with Russia, to the bemusement of the Russian media.

Not coincidentally, the war drums around North Korea, a Treasury Secretary threatening the former largest holder of U.S. government debt in China with being cutoff from the American banking system (a step which would implode what's left of the economy overnight), and the #RussiaGate agitprop campaign are reaching ludicrous levels, as Washington and Wall Street grow desperate from losing control over the dollar's role in global tradeSince the BRICS summit of early September, in which Russian President Vladimir Putin declared that the unjust manipulation of (the dollar's) reserve currency status must be addressed through multipolar action, we can see the policy being implemented in concert by the Eurasian powers -- namely China, Russia, Iran, and soon to be ex-NATO member Turkey.

The ruble is not yet being 'nationalized' as Russian nationalist economists like Nikolai Starikov or Putin adviser Sergey Glazyev have long advocated. But hints of a sovereign crypto-yuan in China amidst Beijing's crackdown on bitcoin/ethereum exchanges naturally suggests Eurasian wide coordination with Moscow planning something similar in the near future -- a crypto-ruble allowing oil and gas trade settlement in gold.

The Sirius Report's London Paul has some of the story in a September 19, 2017 post reproduced below. -- JWS

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Iran and Russia Look to Establish a Joint Bank, Trading in Non-Dollar Terms

Iran and Russia Look to Establish a Joint Bank, Trading in Non-Dollar Terms

Iran's emergence from western sanctions since the nuclear deal with the U.S. and EU has made it an even more attractive market for Russian investment. With a banking sector that has long been neglected since the 1979 Islamic Revolution, Russian financial specialists are at the forefront of establishing trade settlement in national currencies rather than the dollar and euro. -- JWS

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Iran is Set to Join EAEU in a Free Trade Zone Agreement

Iran is Set to Join EAEU in a Free Trade Zone Agreement

Saturday marked the 64th anniversary of the CIA sponsored coup to overthrow Iranian Prime Minister Mohammad Mosaddegh. With the Iranian Revolutionary Guard Corps (IRGC) and its proxies victory over ISIS and so-called moderate rebels backed by arch rival Saudi Arabia in Syria, and growing relations with neighboring Qatar and Turkey, Iran is once again emerging as the dominant power in the Persian Gulf region as it was prior to the 1979 revolution.

Besides its enormous oil and gas reserves rapidly developing after the nuclear deal with the U.S. and EU removed sanctions, the most important factor in Iran's rise is trade, not military might or revolutionary Shi'a Muslim ideology. The country is a pivotal part of connecting the One Belt One Road (OBOR) to the North South Transport (INSTC) Corridor through the Caucuses (Georgia, Armenia, Azerbaijan)

Both projects intimately involve Iran's military ally and Caspian Sea partner Russia, which has helped Iran overcome its shortage of refining capacity in a weak oil price market in return for purchasing Russian goods. In addition to Iran, Turkey is also signing on to the Eurasian Economic Union customs agreement, ensuring the smooth flow of goods from the Indian subcontinent and Persian Gulf to Turkish Mediterranean/Black Sea ports supplying Europe. Such critical mass makes for a tremendous magnet, including to historic U.S. allies like Pakistan, Egypt and Israel or countries that have drifted from non-aligned status to quasi-U.S. defense partners in recent years, like India. -- JWS

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