For those who like me, like to see the news in one place only:
"
According to reports, UAE Central Bank Governor Khaled Mohamed Balama met US Treasury Secretary Scott Bessent and Federal Reserve officials to discuss a potential currency swap line. These arrangements allow countries to access dollars during periods of stress. It further helps in stabilizing reserves and currencies.
The UAE framed the discussion as precautionary. The ongoing Iran war has already disrupted shipping routes and energy flows through the Strait of Hormuz. This has been affecting dollar inflows tied to oil exports. Officials indicated that if the situation drags on and liquidity tightens, they would need a fallback.
As per these officials, the fallback could include settling oil transactions in other currencies such as the Chinese yuan.
"
Random thought, not an economist but the yuan and the dollar are both based on economies that just make up numbers to keep themselves afloat, is the dollars status as the reserve currency dependant on us showing the world we can push countries like Iran around and we're losing that perception or (i imagine it is) a lot more than that?
This comment should be higher. The amount of people who think all of this is caused by the US wandering blindly into a massive catastrophe. Those three countries have focused on the long game, and leveraged Trump’s ego to get what they want - often through shady deals and telling him what he wants to hear. The US has been royally played, and I’m not sure it’s going to ever recover.
The fact that this was possible in the first place is depressing. The Republican Party didn’t take power by force, but with the support of tens of millions of Americans and the passive support of tens of millions more. Red China didn’t have to send fighter planes to Washington, the people gave up their country to their God King Trump.
Brute force is an inferior weapon in this day and age. Investment in psy-ops is the smart way to cripple/ruin nations. They do it for you, like you said.
Other countries are not afforded that grace when their governments are disrupted by the CIA or US Military intervention. Everything bad is attributed to their incompetence or culture or race by western politicians and analysts.
One of the problems with US intelligence and strategic planning when it comes to our adversaries is our long term efforts are susceptible to shifting every four years, while those of China don't. Though we try and work toward decade outlooks, the Chinese look generationally
“The US have been royally played” dont play the victim, the US voted for Trump twice… the world knew he was a crook a pedo and a joke, still you voted for the guy... twice. Good luck from now.
I'm not sure it was even just a matter of ego, as they hold all the dirt on him. Stealing money and coercion are the only two things Krasnov really understands.
America has been attempting to speedrun it's hegemonic collapse almost since it emerged out of WWII. From the Korean War to Vietnam to how we dismantled the USSR to Afghanistan/Iraq to sowing the seeds of their own blowback all over the world.
To our own refusal to take care of the citizens within the imperial core and spread the gains of empire in a way that keeps immiseration low, or actually takes steps to curb our bourgeoisie democracy that has allowed capital to take total control of the ship for short term gains that create massive long term problems.
Do foreign nations attempt to influence things domestically? Absolutely. Israel being the most successful(but even that is a bit more complex as Israel is also an America vassal). But history will not be written about how America was this innocent great nation taken down by evil foreign adversaries, it will be written as a cautionary tale of the ultimate imperial hubris.
Good goy. Here's the data, I'll let you judge which currency is back by thin air and big promises :
USA
Total national debt: $38.96 Trillion
Debt to GDP ratio: 137%
Debt per capita : $116,000
China
Total national debt: $18.70 Trillion
Debt to GDP ratio: 96%
Debt per capita: $13,000
While China is a major holder of foreign (mostly U.S.) debt, the U.S. position is fundamentally different because it is a "debtor nation."
China’s Ownership: China holds approximately $693.3 Billion in U.S. Treasuries (as of early 2026). Their strategy is to hold foreign bonds to keep their own currency stable and ensure liquidity for global trade.
USA’s Ownership: The U.S. government holds very little in foreign government bonds (roughly $20–$30 Billion in total). Instead, the U.S. "leverages" the world by having foreign nations hold its debt.
Only point where the US still OFFICIALLY outperforms China is gold reserves, about twice as much as Chinese reserves. I said "officially" because of the controversy claiming that thousands of the "gold bars" kept at Fort Knox are actually plated tungsten with duplicate serial numbers.
The dollar's status as reserve currency comes about because there is a global banking and investment system in US dollars.
There is not one in Chinese currency because China doesn't allow it. They'd have to loosen internal capital controls and have a free floating currency and let international banks trade hold Chinese bonds freely, like they do with US bonds today. China doesn't want that for their own reasons.
UAE wouldn't particularly like to keep yuan as the flexibility of that is lower than a US dollar. Basically it's probably arbitrage, sanctioned regimes that can't get dollars buy petroleum from UAE and UAE which can somehow convince China to let them trade yuan for dollars then does so.
How would US reserve currency be threatened? By having some US appointees exert as idiotic and foolish authority as they do over the US military and engage in jingoistic and stupid aggressions.
For instance, a certain kind of Supreme Leader gets insulted by a French meme on social media, and then takes over the Federal Reserve's transfer system with some DOGE boys and then orders the Fed Master accounts of French Banks seized (large banks bank with the Fed in a literal transactional & account sense, which is why it is called a central Bank, as much of their net ownership dollars is parked there), expropriating cash and Treasury securities.
Anything that threatens the stability and soundness of the banking system infrastructure---return of capital and not return on capital---immediately threatens reserve currency status in a blink.
The saving grace is that the above scenario is sufficiently technically obscure and involves entities that the ideologues and cable networks the ideologues fixate upon have no idea about and so the typical Supreme Leader is unaware of such an option or existence.
China won't even want to have a reserve currency, since they like their currency very weak to fuel exports. Moreover, it would require them to run trade deficits, which is also not their style nor do they seem to want to move in that direction.
What’s that got to do with the price of eggs in China? I was referring to the US freezing Russia’s Central Bank assets (reserves etc) as punishment for the invasion of Ukraine.
Yeah. Cause they don't want to be an importing country. They are happy to trade in USD to an extent.
See
If you want other countries to use Yuan, other countries need to have yuans. That can only happen if china gives more yuan for goods/service than they take yuan for selling goods/service. China's trade deficit is reverse, so they can't really push their currency as global reserve currency.
This is also why Trump wanting 0 trade deficit contradicted their plan to keep US as default global currency. How will other countries have dollars to trade with if the US doesn't have outflow of dollars as a net importer?
>People do petro dollar because everyone needs to buy dollars to buy oil.
Countries don’t “need” to buy oil in dollars. A contract can be executed in any currency the two parties want, and it’s been happening more often in recent years, but by and large, a lot of countries still choose to conduct transactions in dollars because it’s the worlds reserve currency, backed by the US military.
It's about how secure and stable the country issuing the currency is and how many places you can use that currency as a swap. These days it is also about the payment system and how likely it is that the system can/will be used to sanction your country or your partners.
The U.S. currency use to be backed by the amount of gold we held in reserve, known as the gold standard but Nixon went away from that in the 70s. Since then it’s been fiat currency backed by our military might and strength of the U.S. Dollar compared to other currencies. It was that way for a long time.
China is facing the same thing but in reverse. Their currency was seen as being unstable due to politics of their country as well as their lack of industrial might. That changed in the 90s/early 2000s when corporations began moving operations to the country. China is now the second largest world economy and has been gaining ground quickly. What scares me most about China isn’t that they’ve grown so quickly as a world power but the fact that their government system is a combination of “democracy” mixed with black mirror style dystopia. They have a growing homeless population of young adults that have negative social credit that has basically caused those youths to lose housing, jobs, and access to medical care.
Exactly this. The only other superpower in the world that could compete with US in intelligence, military, and cutting edge tech is China. This will push Trump to do some drastic things. I'm guessing some extreme bombing in the Tehran area and then another "round of negotiations".
The most important part of a reserve currency is capital controls. Unfortunately, China restricts the free movement of money into and out of the country to prevent financial instability, which hinders investors from freely trading the currency.
If China wants Yuan to be the reserve currency, it needs to have much less restriction from foreigners accessing it, then withdrawing it out of the country.
China's currency flows affect the value of the actual currency itself, even for transactions that take place outside of its borders. If you're holding a billion yuan and China won't let you buy anything from them, you're still stuck trying to find someone else who will sell you stuff in yuan-denominated prices (and their valuation of your yuan will depend on how easily they can spend it).
I think the point here is that it the Yuan starts to be used more to settle trade between two intermediaries, neither of which are China, then it's attractiveness as a reserve currency grows.
The core thing underlying reserve currency status is whether central banks hold your currency and see it as a stable source of value which will appreciate over time (and ideally beat inflation). Plenty of stable fungible currencies exist. The Swiss franc or Swedish Kroner are arguably more stable. They still aren’t ~65% of global central bank assets at time of writing. Chinas currency is also not nearly as fungible as it is not free floating, and China has extreme capital controls as mentioned above.
China gives other countries swap lines in RMB to promote their currency. Given China manufactures everything, their currency is effectively the Amazon gift card of currencies -- not as good money that you can use to invest, but still useful.
Instead of using those swap lines to promote trade, some countries are using them as rainy day fund or short-term loan. UAE wants the same from US.
People who think the RMB will be the new reserve currency don't understand how reserve currencies are chosen. We have a better chance of creating a new "Earth" currency and using that.
And people who think the USD isn’t being replaced as the world’s reserve currency need to realise that the USD replaced the British pound as the worlds reserve currency over two weeks in 1956.
Suspect this might be why central banks are buying up gold.
Everyone seems to be framing this as US v China in this thread. People don't need another currency necessarily. International currencies and trade has been backed by gold for thousands of years.
UAE can price in yuan. The worlds financial institutions are still driven by treasuries in USD. it doesn't really matter. yuan doesn't make for collateral like treasuries and dollars do. People don't want it. UAE is making their own life more difficult if they do this.
Clickbait headline and I had to click on it so you don't have to. What the body of the article basically says that if dollars become tight they'll have to start selling oil in other currencies. I'm not sure why the availability of dollars would get tight tho, that doesn't seem to be an issue as far as I know.
Also worth noting the Emirati dirham is pegged to the USD
UAE gets dollars from oil sales and tourism. Both have declined because of the war. They have significant assets but they are real estate and other non liquid assets.
UAE needs US dollars primarily to maintain the peg of the UAE Dirham (AED), which has been fixed at approximately 3.67 AED to 1 USD since 1978, ensuring monetary stability and low inflation
> UAE gets dollars from oil sales and tourism. Both have declined because of the war.
Fair point but then how does pricing oil in other currencies solve that problem when you literally can't sell oil due to oil tankers not being able to move from point A to point B?
It's more that they only price it in dollars (which benefits the United States a great deal and does little for them directly) because we give them certain assurances.
If we can no longer make those assurances there is another superpower in town.
Both sides of the isle in the USA have think tanks constantly writing breathless articles about the suicidal nature of arrogant complacently exactly like yours wrt China.
China right now looks a lot more stable than the US. Post Cultural revolution, China’s government has been making pretty prudent moves to increase standards of living as well as global power. The US meanwhile in the same time span has been in nearly constant war and it’s been tearing itself to shreds for the past decade. China’s been looking pretty stable by comparison.
I realize this is an economics sub, but really, changing currencies has a lot less to do with economics than it has to do with a signalling of a realignment from a heavy US based influence, to incorporating more Chinese influence. This is broadly consistent with most of the US’s former allies who are all decoupling from the US economy and political orbits and plotting more independent paths.
How much has China done for it's ally Iran in this war? Not much. If you are Gulf state and you are sick of the US over what is going on China isn't a replacement
It doesn't help them, it hurts the US. They are basically saying "your war is hurting us, guarantee our AED with USD or we turn elsewhere and the USD loses credibility as the global currency".
It speaks more to their perception of US responsibility for their issues imo.
Nah, it assumes the consequences are hurting the UAE, likely out of line with what the US promised on the way in. From being hit directly, having trade restricted for a protracted period, and now risking their USD assurance.
The replies to your question are all bots or shills making up their own narrative.
The answer is because Iran is currently allowing tankers that pay tolls in yuan or cryptocurrencies through the strait.
And the UAE brought this up with the US because their economy is tied to the dollar, and not being able to get dollars poses a liquidity risk for them. Cash simply won't be able to flow if they can't get currency. At no point did they insinuate the request is a "threat" or to "stick it to the US." They have already had a currency swap with Bahrain to try to stabilize things.
From the WSJ (the actual source of the story, not this clickbait shill site):
>The talks highlighted the U.A.E.’s concern that the war could inflict major damage on its economy and its position as a global financial hub, depleting its foreign reserves and scaring away investors who once saw it as a stable and secure place for their money. The conflict has damaged Emirati oil-and-gas infrastructure and shut off their ability to sell oil using tankers transiting the Strait of Hormuz, depriving it of a key source of dollar revenues.
Gulf states and UAE in particular have been trying to get more dollars:
>Gulf countries have also raised billions of dollars in debt from investors over the past week, highlighting their push to have cash on hand as they face what the International Energy Agency has called “the most severe oil-supply shock in history.”
>Abu Dhabi, the U.A.E.’s capital and the richest of the seven emirates that make up the country, raised around $4 billion from investors in private-placement transactions arranged by banks including Goldman Sachs earlier this month, people familiar with the matter said. The emirate borrowed at a premium to avoid a drawn-out fundraising process, they said.
>Bahrain also set up a roughly $5 billion swap line with the U.A.E. earlier this month to help improve financial stability, the countries’ central banks said.
Also this note contradicts the narrative pushed in these comments:
>The war also has driven the Emiratis closer to the U.S. and, at least for now, to abandon the notion that forging diplomatic and financial ties to Iran would help insulate it from the region’s conflicts.
It’s the threat of subverting the dollar if the US doesn’t step in and help damage control the mess they dropped on the UAEs doorstep. Keep in mind until a few months ago the UAE was also one of the hottest real estate markets in the world so they’ve also got a ton of exposed real estate debt staring at them too which will also eat up cash. And the monarchies in the gulf only continue to function when everyone’s getting properly glazed. If there’s actual hardship, things are going to get ugly quick. Their whole labor force is imported, the last thing actual Emiratis want to do is work…
The UAE is against a problem. They were probably hoping this would conveniently remove a problem, not create a couple of actual existential ones for the sheikhs
In Sudan the RSF supported by UAE are killing everyone since 2023.
400,000 dead.
12,000,000 forcibly displaced.
24,000,000 suffering from severe malnutrition.
Over 14,000 women and girls raped. A portion of the $120 million meant for Sudan approved by Congress in 2024 through USAID which then was frozen by Trump would have gotten directly to healthcare (physical and mental) along with food for those women and girls. PBS did a great job covering that exact aid…
https://youtu.be/7DARp8THT0U?si=CMwk44upeW5LlmcY
The UAE buys most of the weapons from the UK and China
"we might swap off of dollars" is a different message than "please give us more dollars we want to buy literally every dollar you'll print, we're desperate for dollars"
This is the unpaywalled article from WSJ that this clickbait website attempted to report on with its clickbait headline. Shocking that "blocknow" isn't more prudent with their reporting lol
Do it. Know where people are going to get the Yuan from? China. Know how they're going to buy it? With all the dollars they have. No country with like $100+ billion in US cash equivalents is going to threaten the value of those savings.
"Petrodollar" is a term that always gets headlines and excited commentary.
But ultimately, there are two potential competitors: Yuan and Euro. Neither seem to want the dollar's role.
If China demanded to pay in Yuan, many would probably take Yuan. Russia certainly might. Yuan is (theoretically) easy to use, considering that most countries import a lot of stuff from China.
But... there is just no sign that China want any of this. They are doing really well under the current trading system, and have been for decades.
Crypto boosters would point to Bitcoin and the gold bugs to Gold and the wider precious metals basket.
Basically people no longer trust US stewardship. The Euro, the Yuan, Bitcoin, precious metals, all have their pros and cons but one common pro is it's not the US$
The UAE needs to export oil because that's what their entire economy is built on, Iran said it lets ships through if their transactions are done in yuan. It doesn't surprise me the UAE isn't willing to take a big L for a stupid war like this one
The article says they running short on dollars because they're not selling oil and they proposed to solve the problem of not being able to sell oil by pricing it in yuan. ??????
Obviously I'm missing something here.
It also says they're experiencing capital flight depleting their $ reserves, which is a problem because their currency is fixed to the $.
Not sure how pricing oil they're not selling in yuan will fix that.
Article also say they've been doing lucrative business providing banking services for Iran and Russia.
Somehow the rest of us should be concerned of them losing that business.
Maybe they could ask their RSF buddies in Sudan for help. From what I read the Sudanese are loaded with dollars. Just don't hide it in your couch
Maybe we can finally put to bed the insane notion that it's meaningful to the US that other countries trade using USD beyond trade stabilization. I don't understand how it persisted beyond the Euro existing.
It was a deliberate national security act. The petrodollar is why our sanctions have teeth. The collapse of which means a more violent world as the US uses its only playing card: bombs.
The thing is, it had teeth when the purpose was to maintain peace. When you start wars and cause turbulent markets then why would the world reward the US when it’s causing chaos from afar, while enduring the least effects compared to the rest of the world?
The purpose was never really to maintain peace. Trump's definitely more violence-oriented but at least the Republican presidents have consistently not been using it to maintain peace.
No it doesn't. You can get a bank account denominated in USD in any country in the world.
Countries don't need permission or help from the US for their banks to use USD. How do you think Russia has been continuing to use USD despite the sanctions?
I feel like youre missing his point about sanctions, which is that they make things more difficult. Thus acting as a weapon to keep people in line.
Its true Russia continues to bring in USD, but through more difficult processes. Trading their oil/resources to countries that hold usd, using 3rd party/intermediary import partners, ghost fleets.
And even when trading with countries that hold usd, there is a large portion that can only buy it at lower/capped rates. The EU even prior to the Ukraine war had an imposed price cap on russian energy.
And a lot of that is based on geography and resource reserves. A country with less resources or more difficult geography than Russia will be even more impacted. So sanctions have greater impact
It will be fruitless for a bank to hold funds in USD and not be able to transfer funds to other banks. After all that is why the customers want the facility in the first place. If they need to be able to transfer funds, they need Swift.
You need more access to US facilities if you want to earn your interest on Treasury securities---people hold dollars for investment too. The Ayatollah can't quite present his CUSIP to Treasury and ask for payment in uranium.
The bond market determines reserve currency status primarily
No, you need access to a messaging and settlement system that will accept USD transactions. Swift is the most prominent not the only. They can also use intermediary banks to transact across multiple systems.
Secondary sanctions work because most major companies, particularly banks, want to be able to do business with US entities. They work better when the EU joins because that ends up covering most of the world.
They are not trading USDs. It's a securities exchange.
The actual effect is lower US cost of borrowing because demand for USTs is higher. Most external demand is for safe harbor, monetary policy and screwing with exchange rates.
Correct me if im wrong here but if countries dont buy our treasury bonds the FED has to buy them, which is printing money, which causes inflation. If we're not the global reserve currency, we have less bond demand.
British citizens today are much better off than they were 150 years ago when pound sterling was the primary currency. There is no reason to think it will be any different for Americans.
People tend to reverse cause and effect. The dollar is eminent because the USA is large, rich and powerful. It will lose its status once the USA is not large rich and powerful anymore. Not the other way around.
Another mistake is to tie your country's position in the world to your own wellbeing. These are not necessarily connected. The Netherlands is not a world power anymore, yet its citizens are still some of the wealthiest in the world. Finland has never been a world power and Finns are considered to be the happiest people in the world. Neither country has its own currency.
Totally. When Europe switched to Euro settlement that immediately caused a depression. Same when China started doing it with Renminbi.
This is the argument under the gold standard not under fiat, we are closing in on a century since the US was on the standard so might be time to update your understanding.
For a second it sounded like you’re trying to argue for a reversion back to the gold standard, but sounds like I misread you.
Even still, making the argument that losing reserve currency status doesn’t matter is beyond lunacy. We’re only able to print our way out of crises because of the reserve status.
We’re only able to export our inflation because of that status.
We only are able to fund our deficits because of that status.
We lose commodity pricing advantage without that status.
All of the things we stopped doing like manufacturing, production of goods, and being first in innovation suddenly hurt a LOT when we lose that status.
You genuinely have no idea what you’re talking about, trying to draw some false equivalence between dollar dominance and the RMB and the Euro tells me exactly that
> Even still, making the argument that losing reserve currency status doesn’t matter is beyond lunacy.
Krugman makes the argument regularly. https://web.mit.edu/krugman/www/seignor.html is an old one, newer articles are behind subscription walls.
Also see various posts on /r/AskEconomics on the topic: https://www.reddit.com/r/AskEconomics/comments/1m3331p/what_is_the_advantage_of_being_a_global_currency/
And another thing: the petrodollar and the reserve currency status are related but different.
First off, the Euro is always one far right national election victory away from an existential crisis. So it only looks stable compared to the US dollar because Trump is in power in the US
Second, arabs sell oil in dollars because they are under the protection of the US. The smaller oil rich arab countries may not exactly be happy with that arrangement right now but Saudi was for this war with Iran from go. Either way, they have no other choice, the US is the only game in town. Europe is occupied with Russia so they aren't a replacement for the US. Russia and China are not only the ally of their enemy but they haven't even really done much for their ally during this war so I don't know why you would trade the US for Russia or China even if you were sick of the US.
If you are saying the US doesn't really care that other countries use or don't use the USD for trade besides for trade stabilization, I don't agree with that. I think they care a lot and for a lot of reasons.
Given the UAE wanted this war along with Saudis and Israel my sympathies are limited. We are spending a few hundred billion on their security. Not ours.
UAE expectation was that Iran should be a cake walk. Iran asymmetrical warfare has rendered the us might practically useless. Now UAE wants a slice of yuan pie
> Iran asymmetrical warfare has rendered the us might practically useless
Not quite. If that was true then Iran wouldn't even consider agreeing to go back into negotiations over giving up it's own nuclear program. They would be holding out instead
If we get to the point where the Iranians are still attacking ships that are not paying the toll and/or not following their rules the US will keep the Gulf of Oman closed
If Trump cares he actively wants other countries to stop using the USD for trade because he wants the US to manufacture things rather than importing them cheaply.
Clickbait headline. Nothing they implied would actually happen more likely they would lean towards the Yen or Euro. The reality is that stability remains the priority for the GCC. While headlines often scream about de-dollarization, the logistical nightmare of switching to a currency with limited liquidity or heavy government intervention—like the Yuan or a restricted Rupee—makes little sense for nations whose economic models rely on seamless global capital flows. Bilateral trade agreements for specific sectors, such as India’s pharmaceutical exports or food security initiatives, are pragmatic hedges, but they are a far cry from a structural shift in monetary policy. Ultimately, a currency that isn't fully convertible cannot provide the safety net required for the massive sovereign wealth funds these countries manage.
The word “threatened” in the title is pure click bait. UAE needs financial liquidity to settle the transactions and it is crystal clear to everyone involved that they will settle on best possible terms. Yuan and other currencies are always the options for everyone. The are all sorts of procedural and contractual problems either getting away from the USD.
China probably wouldn't like this if they pegged it to the yuan. China has kept the yuan close to 7 yuan to $1 USD for the longest time to bring manufacturing. Their competitive advantage would be gone if the yuan strengthens.
Yuan isn't a free market driven currency. Their central bank uses reserves to balance the yuan's value when needed.
Why do People post idiotic articles on economics sub? The UAE has a strong military and is perfectly protecting itself by building buried pipelines to the sea of Oman.
It's also a clickbait title. The UAE isn't threatening using the Yuan. They're just saying they need more USD to ensure they can keep processing payments.
You know, this game of see how long the US and Iran can pressure each other and see who folds first, likely did not take into account how many other countries would fold before either of them..
freezeontheway | 10 days ago
For those who like me, like to see the news in one place only:
" According to reports, UAE Central Bank Governor Khaled Mohamed Balama met US Treasury Secretary Scott Bessent and Federal Reserve officials to discuss a potential currency swap line. These arrangements allow countries to access dollars during periods of stress. It further helps in stabilizing reserves and currencies.
The UAE framed the discussion as precautionary. The ongoing Iran war has already disrupted shipping routes and energy flows through the Strait of Hormuz. This has been affecting dollar inflows tied to oil exports. Officials indicated that if the situation drags on and liquidity tightens, they would need a fallback.
As per these officials, the fallback could include settling oil transactions in other currencies such as the Chinese yuan. "
croatiancroc | 10 days ago
How would selling in yuan help their currency?
CarsonWentzGOAT1 | 10 days ago
Iran allows ships to go through if the oil is paid in yuan
kinkycarbon | 10 days ago
Yuan moves closer to being global reserve currency for which stuff is rated against.
Quick_Effort594 | 10 days ago
Random thought, not an economist but the yuan and the dollar are both based on economies that just make up numbers to keep themselves afloat, is the dollars status as the reserve currency dependant on us showing the world we can push countries like Iran around and we're losing that perception or (i imagine it is) a lot more than that?
HowSwayGotTheAns | 10 days ago
Yes, the US dollar is backed by the petrodollar, which is backed by the US military.
LazyItem | 10 days ago
If idiots are in control of US military then that becomes a liability
Sipikay | 10 days ago
As was the plan. When Russian, Chinese, and Israeli intelligence tag-teamed the US into incompetency.
Kiwizoo | 10 days ago
This comment should be higher. The amount of people who think all of this is caused by the US wandering blindly into a massive catastrophe. Those three countries have focused on the long game, and leveraged Trump’s ego to get what they want - often through shady deals and telling him what he wants to hear. The US has been royally played, and I’m not sure it’s going to ever recover.
Gloomy-Recipe9213 | 10 days ago
The fact that this was possible in the first place is depressing. The Republican Party didn’t take power by force, but with the support of tens of millions of Americans and the passive support of tens of millions more. Red China didn’t have to send fighter planes to Washington, the people gave up their country to their God King Trump.
Lemp_Triscuit11 | 10 days ago
> The fact that this was possible in the first place is depressing.
Looking at the culture and climate I grew up in (90s suburban midwest), the depressing part was that it seemed inevitable
Tricky_Try8757 | 10 days ago
Brute force is an inferior weapon in this day and age. Investment in psy-ops is the smart way to cripple/ruin nations. They do it for you, like you said.
uptnapishtim | 10 days ago
Other countries are not afforded that grace when their governments are disrupted by the CIA or US Military intervention. Everything bad is attributed to their incompetence or culture or race by western politicians and analysts.
lameth | 10 days ago
One of the problems with US intelligence and strategic planning when it comes to our adversaries is our long term efforts are susceptible to shifting every four years, while those of China don't. Though we try and work toward decade outlooks, the Chinese look generationally
Pocpoc-tam | 10 days ago
“The US have been royally played” dont play the victim, the US voted for Trump twice… the world knew he was a crook a pedo and a joke, still you voted for the guy... twice. Good luck from now.
DerpsAndRags | 10 days ago
I'm not sure it was even just a matter of ego, as they hold all the dirt on him. Stealing money and coercion are the only two things Krasnov really understands.
nickifer | 10 days ago
not sure where the dprk falls on the punnett square but they feel like chaotic idiocy
NOLA-Bronco | 10 days ago
I'm sorry but this is cope
America has been attempting to speedrun it's hegemonic collapse almost since it emerged out of WWII. From the Korean War to Vietnam to how we dismantled the USSR to Afghanistan/Iraq to sowing the seeds of their own blowback all over the world.
To our own refusal to take care of the citizens within the imperial core and spread the gains of empire in a way that keeps immiseration low, or actually takes steps to curb our bourgeoisie democracy that has allowed capital to take total control of the ship for short term gains that create massive long term problems.
Do foreign nations attempt to influence things domestically? Absolutely. Israel being the most successful(but even that is a bit more complex as Israel is also an America vassal). But history will not be written about how America was this innocent great nation taken down by evil foreign adversaries, it will be written as a cautionary tale of the ultimate imperial hubris.
Flederm4us | 10 days ago
Idiots have been in control of the US military since the 1960's and the Vietnam debacle.
CashComet | 10 days ago
Good goy. Here's the data, I'll let you judge which currency is back by thin air and big promises :
USA
Total national debt: $38.96 Trillion Debt to GDP ratio: 137% Debt per capita : $116,000
China
Total national debt: $18.70 Trillion Debt to GDP ratio: 96%
Debt per capita: $13,000
While China is a major holder of foreign (mostly U.S.) debt, the U.S. position is fundamentally different because it is a "debtor nation."
China’s Ownership: China holds approximately $693.3 Billion in U.S. Treasuries (as of early 2026). Their strategy is to hold foreign bonds to keep their own currency stable and ensure liquidity for global trade.
USA’s Ownership: The U.S. government holds very little in foreign government bonds (roughly $20–$30 Billion in total). Instead, the U.S. "leverages" the world by having foreign nations hold its debt.
Only point where the US still OFFICIALLY outperforms China is gold reserves, about twice as much as Chinese reserves. I said "officially" because of the controversy claiming that thousands of the "gold bars" kept at Fort Knox are actually plated tungsten with duplicate serial numbers.
DrXaos | 10 days ago
that's not what a petrodollar is: that is dollars earned by gulf states which then buy back US based investments.
HowSwayGotTheAns | 10 days ago
Haven't you noticed that the US military has been quite active in SWANA since the 1970s?
DependentAdvance226 | 10 days ago
And the dollar is free floating. The yuan is tightly controlled and not allowed to respond to market forces, which keeps investment into it low.
DrXaos | 10 days ago
The dollar's status as reserve currency comes about because there is a global banking and investment system in US dollars.
There is not one in Chinese currency because China doesn't allow it. They'd have to loosen internal capital controls and have a free floating currency and let international banks trade hold Chinese bonds freely, like they do with US bonds today. China doesn't want that for their own reasons.
UAE wouldn't particularly like to keep yuan as the flexibility of that is lower than a US dollar. Basically it's probably arbitrage, sanctioned regimes that can't get dollars buy petroleum from UAE and UAE which can somehow convince China to let them trade yuan for dollars then does so.
How would US reserve currency be threatened? By having some US appointees exert as idiotic and foolish authority as they do over the US military and engage in jingoistic and stupid aggressions.
For instance, a certain kind of Supreme Leader gets insulted by a French meme on social media, and then takes over the Federal Reserve's transfer system with some DOGE boys and then orders the Fed Master accounts of French Banks seized (large banks bank with the Fed in a literal transactional & account sense, which is why it is called a central Bank, as much of their net ownership dollars is parked there), expropriating cash and Treasury securities.
Anything that threatens the stability and soundness of the banking system infrastructure---return of capital and not return on capital---immediately threatens reserve currency status in a blink.
The saving grace is that the above scenario is sufficiently technically obscure and involves entities that the ideologues and cable networks the ideologues fixate upon have no idea about and so the typical Supreme Leader is unaware of such an option or existence.
Super_Toot | 10 days ago
Try getting your money out of the USA vs China.
China will never be a reserve currency
Precisiongu1ded | 10 days ago
China won't even want to have a reserve currency, since they like their currency very weak to fuel exports. Moreover, it would require them to run trade deficits, which is also not their style nor do they seem to want to move in that direction.
oursland | 10 days ago
Your information is nearly a decade out of date: Petroyuan
Freud-Network | 10 days ago
They'll still be saying the same shit as the petrodollar collapses. Followed by, "WHO COULD HAVE SEEN THIS COMING?!@?"
leakygutters | 10 days ago
Tell that to the Russians.
Saw-Sage_GoBlin | 10 days ago
Are you of the opinion that Russia makes good decisions?
leakygutters | 10 days ago
What’s that got to do with the price of eggs in China? I was referring to the US freezing Russia’s Central Bank assets (reserves etc) as punishment for the invasion of Ukraine.
quick20minadventure | 10 days ago
People do petro dollar because everyone needs to buy dollars to buy oil.
Yuan doesn't need to be petro yuan because everyone needs to buy yuan to buy stuff china makes.
Or rather, everyone is comfortable holding Yuan because they'll always have something to buy from China.
Elizabeth-WildFox886 | 10 days ago
Except that’s not what’s happening, China itself doesn’t want to be reserve currency.
quick20minadventure | 10 days ago
Yeah. Cause they don't want to be an importing country. They are happy to trade in USD to an extent. See If you want other countries to use Yuan, other countries need to have yuans. That can only happen if china gives more yuan for goods/service than they take yuan for selling goods/service. China's trade deficit is reverse, so they can't really push their currency as global reserve currency.
This is also why Trump wanting 0 trade deficit contradicted their plan to keep US as default global currency. How will other countries have dollars to trade with if the US doesn't have outflow of dollars as a net importer?
whatareutakingabout | 10 days ago
But chinese businesses and government always want USD.
KronusTempus | 10 days ago
>People do petro dollar because everyone needs to buy dollars to buy oil.
Countries don’t “need” to buy oil in dollars. A contract can be executed in any currency the two parties want, and it’s been happening more often in recent years, but by and large, a lot of countries still choose to conduct transactions in dollars because it’s the worlds reserve currency, backed by the US military.
quick20minadventure | 10 days ago
It's cause Saudi didn't renew the petro dollar exclusivity in 2024.
Freud-Network | 10 days ago
It's about how secure and stable the country issuing the currency is and how many places you can use that currency as a swap. These days it is also about the payment system and how likely it is that the system can/will be used to sanction your country or your partners.
Dfiggsmeister | 10 days ago
The U.S. currency use to be backed by the amount of gold we held in reserve, known as the gold standard but Nixon went away from that in the 70s. Since then it’s been fiat currency backed by our military might and strength of the U.S. Dollar compared to other currencies. It was that way for a long time.
China is facing the same thing but in reverse. Their currency was seen as being unstable due to politics of their country as well as their lack of industrial might. That changed in the 90s/early 2000s when corporations began moving operations to the country. China is now the second largest world economy and has been gaining ground quickly. What scares me most about China isn’t that they’ve grown so quickly as a world power but the fact that their government system is a combination of “democracy” mixed with black mirror style dystopia. They have a growing homeless population of young adults that have negative social credit that has basically caused those youths to lose housing, jobs, and access to medical care.
Potential_Jello6520 | 10 days ago
Yes, and this is exactly why Bitcoin exists.
freeshovacadoodoo | 10 days ago
Exactly this. The only other superpower in the world that could compete with US in intelligence, military, and cutting edge tech is China. This will push Trump to do some drastic things. I'm guessing some extreme bombing in the Tehran area and then another "round of negotiations".
salynch | 10 days ago
It is so much more than that, lol.
https://en.wikipedia.org/wiki/Reserve_currency
humanist72781 | 10 days ago
Eh. Unless China opens up its markets the yuan will not seriously be considered a reserve currency
awildstoryteller | 10 days ago
Ultimately the most important part of a reserve currency is it's stability and fungability.
Yuan has both of those in spades right now.
ChaosArcana | 10 days ago
The most important part of a reserve currency is capital controls. Unfortunately, China restricts the free movement of money into and out of the country to prevent financial instability, which hinders investors from freely trading the currency.
If China wants Yuan to be the reserve currency, it needs to have much less restriction from foreigners accessing it, then withdrawing it out of the country.
awildstoryteller | 10 days ago
How much China restricts it is kind of irrelevant if I am not buying from China.
Already-Price-Tin | 10 days ago
China's currency flows affect the value of the actual currency itself, even for transactions that take place outside of its borders. If you're holding a billion yuan and China won't let you buy anything from them, you're still stuck trying to find someone else who will sell you stuff in yuan-denominated prices (and their valuation of your yuan will depend on how easily they can spend it).
awildstoryteller | 10 days ago
I think the point here is that it the Yuan starts to be used more to settle trade between two intermediaries, neither of which are China, then it's attractiveness as a reserve currency grows.
ITrulyWantToDie | 10 days ago
No. Just no.
The core thing underlying reserve currency status is whether central banks hold your currency and see it as a stable source of value which will appreciate over time (and ideally beat inflation). Plenty of stable fungible currencies exist. The Swiss franc or Swedish Kroner are arguably more stable. They still aren’t ~65% of global central bank assets at time of writing. Chinas currency is also not nearly as fungible as it is not free floating, and China has extreme capital controls as mentioned above.
HonestBalloon | 10 days ago
The largest oil deals by volume (between Suadi and China) have been carried in petroyuan for the last couples of years now lol
Sinopec is the now the second largest oil and gas enterprise behind Saudi Aramco.
jmblumenshine | 10 days ago
Also, re-ignites the BRICS push to divest from US Currency.
CrackRocksCokeRules | 10 days ago
Too many controls and can’t back it with power
voidvector | 10 days ago
China gives other countries swap lines in RMB to promote their currency. Given China manufactures everything, their currency is effectively the Amazon gift card of currencies -- not as good money that you can use to invest, but still useful.
Instead of using those swap lines to promote trade, some countries are using them as rainy day fund or short-term loan. UAE wants the same from US.
Good_Hovercraft_2866 | 10 days ago
i currently invest in some Chinese stocks like Alibaba and the gains in rmb the local currency has been pretty solid
resuwreckoning | 10 days ago
The Chinese stock market has so underperformed its GDP appreciation that it’s almost a meme at this point.
It’s as if people forget that the CCP does not like when gains accrue to capital and not the party that controls the commune.
Elizabeth-WildFox886 | 10 days ago
Yuan has about 2% of global currency which is nothing
abasoglu | 10 days ago
Iran allows yuan denominated oil sales to ship through the straits.
MugiwarraD | 10 days ago
u need yuan to pay for hormuz toll.
u need to buy yuan to have yuan.
mspk7305 | 10 days ago
If the dollar loses it's status as the global reserve currency it will collapse the us economy and probably lead to trump using nukes
Saw-Sage_GoBlin | 10 days ago
People who think the RMB will be the new reserve currency don't understand how reserve currencies are chosen. We have a better chance of creating a new "Earth" currency and using that.
Bikerbass | 10 days ago
And people who think the USD isn’t being replaced as the world’s reserve currency need to realise that the USD replaced the British pound as the worlds reserve currency over two weeks in 1956.
It will happen, and it will be quick.
Rick_liner | 10 days ago
Suspect this might be why central banks are buying up gold.
Everyone seems to be framing this as US v China in this thread. People don't need another currency necessarily. International currencies and trade has been backed by gold for thousands of years.
Misfiring | 10 days ago
Not enough gold in the entire world to back the current economy.
chebum | 10 days ago
How would it collapse the economy if US imports relatively little goods? Did you mean this will crash SP500?
Paradoxjjw | 10 days ago
>US imports relatively little goods
Are you sure about that?
mspk7305 | 10 days ago
Plot twist, he's a bot
Takemyfishplease | 10 days ago
Betting on the future
FearlessPark4588 | 10 days ago
UAE can price in yuan. The worlds financial institutions are still driven by treasuries in USD. it doesn't really matter. yuan doesn't make for collateral like treasuries and dollars do. People don't want it. UAE is making their own life more difficult if they do this.
morbie5 | 10 days ago
Clickbait headline and I had to click on it so you don't have to. What the body of the article basically says that if dollars become tight they'll have to start selling oil in other currencies. I'm not sure why the availability of dollars would get tight tho, that doesn't seem to be an issue as far as I know.
Also worth noting the Emirati dirham is pegged to the USD
buscuitsANDgravy | 10 days ago
UAE gets dollars from oil sales and tourism. Both have declined because of the war. They have significant assets but they are real estate and other non liquid assets.
UAE needs US dollars primarily to maintain the peg of the UAE Dirham (AED), which has been fixed at approximately 3.67 AED to 1 USD since 1978, ensuring monetary stability and low inflation
morbie5 | 10 days ago
> UAE gets dollars from oil sales and tourism. Both have declined because of the war.
Fair point but then how does pricing oil in other currencies solve that problem when you literally can't sell oil due to oil tankers not being able to move from point A to point B?
Much-Menu-5789 | 10 days ago
It's more that they only price it in dollars (which benefits the United States a great deal and does little for them directly) because we give them certain assurances.
If we can no longer make those assurances there is another superpower in town.
morbie5 | 10 days ago
> there is another superpower in town
No there isn't
Much-Menu-5789 | 10 days ago
I wonder what year brainwashed patriots stopped being in denial about the crumbling state of the Roman Empire.
resuwreckoning | 10 days ago
Lmao is there really “another superpower in town”?
If so then we’ve really changed the definition of “superpower” for peak Reddit purposes.
Much-Menu-5789 | 10 days ago
Both sides of the isle in the USA have think tanks constantly writing breathless articles about the suicidal nature of arrogant complacently exactly like yours wrt China.
clios_daughter | 10 days ago
China right now looks a lot more stable than the US. Post Cultural revolution, China’s government has been making pretty prudent moves to increase standards of living as well as global power. The US meanwhile in the same time span has been in nearly constant war and it’s been tearing itself to shreds for the past decade. China’s been looking pretty stable by comparison.
I realize this is an economics sub, but really, changing currencies has a lot less to do with economics than it has to do with a signalling of a realignment from a heavy US based influence, to incorporating more Chinese influence. This is broadly consistent with most of the US’s former allies who are all decoupling from the US economy and political orbits and plotting more independent paths.
morbie5 | 10 days ago
How much has China done for it's ally Iran in this war? Not much. If you are Gulf state and you are sick of the US over what is going on China isn't a replacement
-Mandarin | 10 days ago
My guy, peak Reddit is thinking China isn't in the race. China is advancing very quickly and pretty much anyone important knows this.
With complacency like yours, China is all but guaranteed to be the world power.
wintrmt3 | 10 days ago
Dude, on PPP China's economy is 30% bigger than the US'.
Briloop86 | 10 days ago
It doesn't help them, it hurts the US. They are basically saying "your war is hurting us, guarantee our AED with USD or we turn elsewhere and the USD loses credibility as the global currency".
It speaks more to their perception of US responsibility for their issues imo.
morbie5 | 10 days ago
> your war
This assumes UAE was against this war
Briloop86 | 10 days ago
Nah, it assumes the consequences are hurting the UAE, likely out of line with what the US promised on the way in. From being hit directly, having trade restricted for a protracted period, and now risking their USD assurance.
morbie5 | 10 days ago
Even if true that still makes it 'our war' not 'your war'
Briloop86 | 10 days ago
It is certainly a US / Israel war. UAE are not really involved bar being hit as retribution against the US.
morbie5 | 10 days ago
> It is certainly a US / Israel war
Iran certainly doesn't think so or else they wouldn't be bombing UAE
Briloop86 | 10 days ago
Sure they do. It hurts the US on the world stage and it's standing with allies.
Your point is equivalent to saying it is Australia's war (and the wider worlds), or else why did Iran block the strait.
The US made the call to invade / go to war. Iran's responses are to apply pressure to the US to back off.
AeroRanchero | 10 days ago
The replies to your question are all bots or shills making up their own narrative.
The answer is because Iran is currently allowing tankers that pay tolls in yuan or cryptocurrencies through the strait.
And the UAE brought this up with the US because their economy is tied to the dollar, and not being able to get dollars poses a liquidity risk for them. Cash simply won't be able to flow if they can't get currency. At no point did they insinuate the request is a "threat" or to "stick it to the US." They have already had a currency swap with Bahrain to try to stabilize things.
From the WSJ (the actual source of the story, not this clickbait shill site):
>The talks highlighted the U.A.E.’s concern that the war could inflict major damage on its economy and its position as a global financial hub, depleting its foreign reserves and scaring away investors who once saw it as a stable and secure place for their money. The conflict has damaged Emirati oil-and-gas infrastructure and shut off their ability to sell oil using tankers transiting the Strait of Hormuz, depriving it of a key source of dollar revenues.
Gulf states and UAE in particular have been trying to get more dollars: >Gulf countries have also raised billions of dollars in debt from investors over the past week, highlighting their push to have cash on hand as they face what the International Energy Agency has called “the most severe oil-supply shock in history.”
>Abu Dhabi, the U.A.E.’s capital and the richest of the seven emirates that make up the country, raised around $4 billion from investors in private-placement transactions arranged by banks including Goldman Sachs earlier this month, people familiar with the matter said. The emirate borrowed at a premium to avoid a drawn-out fundraising process, they said.
>Bahrain also set up a roughly $5 billion swap line with the U.A.E. earlier this month to help improve financial stability, the countries’ central banks said.
Also this note contradicts the narrative pushed in these comments:
>The war also has driven the Emiratis closer to the U.S. and, at least for now, to abandon the notion that forging diplomatic and financial ties to Iran would help insulate it from the region’s conflicts.
morbie5 | 10 days ago
Good points and yea the Gulf states will be moving closer to the US after the war, they'll have no choice
Pitiful-Recover-3747 | 10 days ago
It’s the threat of subverting the dollar if the US doesn’t step in and help damage control the mess they dropped on the UAEs doorstep. Keep in mind until a few months ago the UAE was also one of the hottest real estate markets in the world so they’ve also got a ton of exposed real estate debt staring at them too which will also eat up cash. And the monarchies in the gulf only continue to function when everyone’s getting properly glazed. If there’s actual hardship, things are going to get ugly quick. Their whole labor force is imported, the last thing actual Emiratis want to do is work…
morbie5 | 10 days ago
> they dropped on the UAEs doorstep
You are making the big assumption the UAE was against this war
> the last thing actual Emiratis want to do is work…
Truth
Pitiful-Recover-3747 | 10 days ago
The UAE is against a problem. They were probably hoping this would conveniently remove a problem, not create a couple of actual existential ones for the sheikhs
morbie5 | 10 days ago
You ain't wrong but 'dropped on the UAEs doorstep' would still be a mischaracterization imo
Minimum-Attitude389 | 10 days ago
Both the US blockade and the Iranians are letting Chinese vessels through.
Mundus_Vincendus | 10 days ago
Tankers can move if they’re using yuan because China didn’t kill Iran’s leaders.
KnifeEdge | 10 days ago
Lol low inflation
nycdiveshack | 10 days ago
UAE is the cause of the crisis in Sudan.
In Sudan the RSF supported by UAE are killing everyone since 2023.
400,000 dead. 12,000,000 forcibly displaced. 24,000,000 suffering from severe malnutrition.
Over 14,000 women and girls raped. A portion of the $120 million meant for Sudan approved by Congress in 2024 through USAID which then was frozen by Trump would have gotten directly to healthcare (physical and mental) along with food for those women and girls. PBS did a great job covering that exact aid…
https://youtu.be/7DARp8THT0U?si=CMwk44upeW5LlmcY
The UAE buys most of the weapons from the UK and China
likwitsnake | 10 days ago
You mean 'blocknow' isn't a legit source?
Plastic-Equipment815 | 10 days ago
Thank you for your service. You saved me from a clickbait.
Sufficient_Steak_839 | 10 days ago
How is that clickbait? It’s exactly what the headline says lol
CallMePyro | 10 days ago
"we might swap off of dollars" is a different message than "please give us more dollars we want to buy literally every dollar you'll print, we're desperate for dollars"
morbie5 | 10 days ago
The headlines implies some sort of blackmail or some type of coercive threat lol
CarsonWentzGOAT1 | 10 days ago
It's not a threat it's reality.
JustAnotherRegardd | 10 days ago
Maybe the yen carry trade?
drfunkensteinnn | 10 days ago
This is the unpaywalled article from WSJ that this clickbait website attempted to report on with its clickbait headline. Shocking that "blocknow" isn't more prudent with their reporting lol
Yet another self own from the Iran war though
https://archive.is/75jzE
thehourglasses | 10 days ago
Marco Rubio speaking prophecy.
>> "There'll be so many countries transacting in currencies other than the dollar that we won't have the ability to sanction them".
No-Channel3917 | 10 days ago
Read the article ya dope
Richandler | 10 days ago
*yawn*
Do it. Know where people are going to get the Yuan from? China. Know how they're going to buy it? With all the dollars they have. No country with like $100+ billion in US cash equivalents is going to threaten the value of those savings.
DrXaos | 10 days ago
except China is trying to keep its yuan down, not up, because it's an exporter.
Golda_M | 10 days ago
"Petrodollar" is a term that always gets headlines and excited commentary.
But ultimately, there are two potential competitors: Yuan and Euro. Neither seem to want the dollar's role.
If China demanded to pay in Yuan, many would probably take Yuan. Russia certainly might. Yuan is (theoretically) easy to use, considering that most countries import a lot of stuff from China.
But... there is just no sign that China want any of this. They are doing really well under the current trading system, and have been for decades.
aurelorba | 10 days ago
> But... there is just no sign that China want any of this.
https://www.gsb.stanford.edu/insights/quick-study-chinas-plan-challenge-dollar#:~:text=China%20now%20wants%20to%20be,debt%20are%20an%20unusual%20mix.
https://www.scmp.com/economy/china-economy/article/3348156/why-kenneth-rogoff-thinks-chinas-yuan-will-be-reserve-currency-next-5-years
https://europeanbusinessmagazine.com/business/why-xi-wants-the-renminbi-to-become-a-global-reserve-currency/
Crypto boosters would point to Bitcoin and the gold bugs to Gold and the wider precious metals basket.
Basically people no longer trust US stewardship. The Euro, the Yuan, Bitcoin, precious metals, all have their pros and cons but one common pro is it's not the US$
Paradoxjjw | 10 days ago
The UAE needs to export oil because that's what their entire economy is built on, Iran said it lets ships through if their transactions are done in yuan. It doesn't surprise me the UAE isn't willing to take a big L for a stupid war like this one
devliegende | 10 days ago
The article says they running short on dollars because they're not selling oil and they proposed to solve the problem of not being able to sell oil by pricing it in yuan. ??????
Obviously I'm missing something here.
It also says they're experiencing capital flight depleting their $ reserves, which is a problem because their currency is fixed to the $.
Not sure how pricing oil they're not selling in yuan will fix that.
Article also say they've been doing lucrative business providing banking services for Iran and Russia.
Somehow the rest of us should be concerned of them losing that business.
Maybe they could ask their RSF buddies in Sudan for help. From what I read the Sudanese are loaded with dollars. Just don't hide it in your couch
ImmortalPoseidon | 10 days ago
You're not missing anything, the headline is just a lie
No-Computer7653 | 10 days ago
Both lol and good.
Maybe we can finally put to bed the insane notion that it's meaningful to the US that other countries trade using USD beyond trade stabilization. I don't understand how it persisted beyond the Euro existing.
DrawingDramatic1641 | 10 days ago
Yeah yuan euro dollar and gold should be more equalised
TimeGrownOld | 10 days ago
It was a deliberate national security act. The petrodollar is why our sanctions have teeth. The collapse of which means a more violent world as the US uses its only playing card: bombs.
ariukidding | 10 days ago
The thing is, it had teeth when the purpose was to maintain peace. When you start wars and cause turbulent markets then why would the world reward the US when it’s causing chaos from afar, while enduring the least effects compared to the rest of the world?
TimeGrownOld | 10 days ago
Yeah, Trump seems hellbent and destroying America's soft power
FlyingBishop | 10 days ago
The purpose was never really to maintain peace. Trump's definitely more violence-oriented but at least the Republican presidents have consistently not been using it to maintain peace.
No-Computer7653 | 10 days ago
That's simply not true. You don't need access to US banks to trade using USDs or use BIS.
TimeGrownOld | 10 days ago
It sure helps
No-Computer7653 | 10 days ago
No it doesn't. You can get a bank account denominated in USD in any country in the world.
Countries don't need permission or help from the US for their banks to use USD. How do you think Russia has been continuing to use USD despite the sanctions?
PickkleRiick | 10 days ago
I feel like youre missing his point about sanctions, which is that they make things more difficult. Thus acting as a weapon to keep people in line.
Its true Russia continues to bring in USD, but through more difficult processes. Trading their oil/resources to countries that hold usd, using 3rd party/intermediary import partners, ghost fleets.
And even when trading with countries that hold usd, there is a large portion that can only buy it at lower/capped rates. The EU even prior to the Ukraine war had an imposed price cap on russian energy.
And a lot of that is based on geography and resource reserves. A country with less resources or more difficult geography than Russia will be even more impacted. So sanctions have greater impact
croatiancroc | 10 days ago
It will be fruitless for a bank to hold funds in USD and not be able to transfer funds to other banks. After all that is why the customers want the facility in the first place. If they need to be able to transfer funds, they need Swift.
No-Computer7653 | 10 days ago
You don't need access to US banks to transfer USD between banks.
DrXaos | 10 days ago
You need more access to US facilities if you want to earn your interest on Treasury securities---people hold dollars for investment too. The Ayatollah can't quite present his CUSIP to Treasury and ask for payment in uranium.
The bond market determines reserve currency status primarily
croatiancroc | 10 days ago
You need access to swift.
Also if you know something I don't, please explain how secondary sanctions work.
No-Computer7653 | 10 days ago
No, you need access to a messaging and settlement system that will accept USD transactions. Swift is the most prominent not the only. They can also use intermediary banks to transact across multiple systems.
Secondary sanctions work because most major companies, particularly banks, want to be able to do business with US entities. They work better when the EU joins because that ends up covering most of the world.
TimeGrownOld | 10 days ago
Anyone can trade with USD; it's the access to the larger global financial system they can limit. Nothing's magical about a piece of paper
NiewinterNacht | 10 days ago
US sanctions seem wildly overused and kind of ineffective.
Richandler | 10 days ago
It's so funny that so many people see it as some sort of threat. It's like, tell us more how little you understand money and econ.
fumar | 10 days ago
You don't want to know what will happen to the value of the dollar.
No-Computer7653 | 10 days ago
Nothing, because the value of the dollar is not related to external trade at all.
Any_Sale2030 | 10 days ago
It’s supply and demand. If people want more dollars it becomes more valuable. If people don’t want dollars as much it becomes less valuable.
No-Computer7653 | 10 days ago
They are not trading USDs. It's a securities exchange.
The actual effect is lower US cost of borrowing because demand for USTs is higher. Most external demand is for safe harbor, monetary policy and screwing with exchange rates.
devliegende | 10 days ago
Not sure the whole supply and demand thing you learned about in high-school works with money.
Probably because money doesn't get consumed (used up) on the demand side and has no constraints on the supply side.
Also supply is a monopoly
Tetter | 10 days ago
Correct me if im wrong here but if countries dont buy our treasury bonds the FED has to buy them, which is printing money, which causes inflation. If we're not the global reserve currency, we have less bond demand.
devliegende | 10 days ago
I'll be happy to correct you but you'll have to say whether you want to talk about supply and demand for bonds or supply and demand for money.
Tetter | 10 days ago
Both I guess, I was wondering about the net impact of losing the world reserve currency status. 🤷
devliegende | 10 days ago
British citizens today are much better off than they were 150 years ago when pound sterling was the primary currency. There is no reason to think it will be any different for Americans.
People tend to reverse cause and effect. The dollar is eminent because the USA is large, rich and powerful. It will lose its status once the USA is not large rich and powerful anymore. Not the other way around.
Another mistake is to tie your country's position in the world to your own wellbeing. These are not necessarily connected. The Netherlands is not a world power anymore, yet its citizens are still some of the wealthiest in the world. Finland has never been a world power and Finns are considered to be the happiest people in the world. Neither country has its own currency.
Sufficient_Steak_839 | 10 days ago
If you live in the US you’re basically advocating to have tk experience a Great Depression this countries never see.
We’re basically nothing without the USD as reserve currency
No-Computer7653 | 10 days ago
Totally. When Europe switched to Euro settlement that immediately caused a depression. Same when China started doing it with Renminbi.
This is the argument under the gold standard not under fiat, we are closing in on a century since the US was on the standard so might be time to update your understanding.
Sufficient_Steak_839 | 10 days ago
Oh great a libertarian nut. Advocating for a reset of the system without any reasonable plan or path on how to get there.
No-Computer7653 | 10 days ago
No, you are arguing the gold bug position. Do you not even understand the position you are taking?
Sufficient_Steak_839 | 10 days ago
For a second it sounded like you’re trying to argue for a reversion back to the gold standard, but sounds like I misread you.
Even still, making the argument that losing reserve currency status doesn’t matter is beyond lunacy. We’re only able to print our way out of crises because of the reserve status.
We’re only able to export our inflation because of that status.
We only are able to fund our deficits because of that status.
We lose commodity pricing advantage without that status.
All of the things we stopped doing like manufacturing, production of goods, and being first in innovation suddenly hurt a LOT when we lose that status.
You genuinely have no idea what you’re talking about, trying to draw some false equivalence between dollar dominance and the RMB and the Euro tells me exactly that
yawkat | 10 days ago
> Even still, making the argument that losing reserve currency status doesn’t matter is beyond lunacy.
Krugman makes the argument regularly. https://web.mit.edu/krugman/www/seignor.html is an old one, newer articles are behind subscription walls.
Also see various posts on /r/AskEconomics on the topic: https://www.reddit.com/r/AskEconomics/comments/1m3331p/what_is_the_advantage_of_being_a_global_currency/
And another thing: the petrodollar and the reserve currency status are related but different.
fec2245 | 10 days ago
Of course you don't.
morbie5 | 10 days ago
First off, the Euro is always one far right national election victory away from an existential crisis. So it only looks stable compared to the US dollar because Trump is in power in the US
Second, arabs sell oil in dollars because they are under the protection of the US. The smaller oil rich arab countries may not exactly be happy with that arrangement right now but Saudi was for this war with Iran from go. Either way, they have no other choice, the US is the only game in town. Europe is occupied with Russia so they aren't a replacement for the US. Russia and China are not only the ally of their enemy but they haven't even really done much for their ally during this war so I don't know why you would trade the US for Russia or China even if you were sick of the US.
If you are saying the US doesn't really care that other countries use or don't use the USD for trade besides for trade stabilization, I don't agree with that. I think they care a lot and for a lot of reasons.
Drak_is_Right | 10 days ago
Given the UAE wanted this war along with Saudis and Israel my sympathies are limited. We are spending a few hundred billion on their security. Not ours.
DebateTop2248 | 10 days ago
UAE expectation was that Iran should be a cake walk. Iran asymmetrical warfare has rendered the us might practically useless. Now UAE wants a slice of yuan pie
morbie5 | 10 days ago
> Iran asymmetrical warfare has rendered the us might practically useless
Not quite. If that was true then Iran wouldn't even consider agreeing to go back into negotiations over giving up it's own nuclear program. They would be holding out instead
DebateTop2248 | 10 days ago
Damage to UAE assets is so huge they are even considering yuan trade to offset damage
morbie5 | 10 days ago
If we get to the point where the Iranians are still attacking ships that are not paying the toll and/or not following their rules the US will keep the Gulf of Oman closed
FlyingBishop | 10 days ago
If Trump cares he actively wants other countries to stop using the USD for trade because he wants the US to manufacture things rather than importing them cheaply.
sin94 | 10 days ago
Clickbait headline. Nothing they implied would actually happen more likely they would lean towards the Yen or Euro. The reality is that stability remains the priority for the GCC. While headlines often scream about de-dollarization, the logistical nightmare of switching to a currency with limited liquidity or heavy government intervention—like the Yuan or a restricted Rupee—makes little sense for nations whose economic models rely on seamless global capital flows. Bilateral trade agreements for specific sectors, such as India’s pharmaceutical exports or food security initiatives, are pragmatic hedges, but they are a far cry from a structural shift in monetary policy. Ultimately, a currency that isn't fully convertible cannot provide the safety net required for the massive sovereign wealth funds these countries manage.
CommercialMassive751 | 10 days ago
The word “threatened” in the title is pure click bait. UAE needs financial liquidity to settle the transactions and it is crystal clear to everyone involved that they will settle on best possible terms. Yuan and other currencies are always the options for everyone. The are all sorts of procedural and contractual problems either getting away from the USD.
chedder | 10 days ago
Those contracts ended two years ago, you can look it up.
So the petrodollar is over.
CommercialMassive751 | 10 days ago
Are you referring to Saudi Arabia in 2024?
This is a good review of the topic.
Unhappy-Exchange-771 | 10 days ago
So they aren’t threatening they are just running by the idea and asking to potentially have access to more USD deepening our relationship.
Reddit is so anti American they will take any little scrape they can and try to turn it into a big deal.
princemousey1 | 10 days ago
As usual, garbage article. Here’s the quote, and you tell me if it makes sense: UAE will price oil in Chinese yuan if they run short of US dollars.
Why will they request Chinese yuan if they have a shortage of US dollars and need more?
Dudedude88 | 10 days ago
China probably wouldn't like this if they pegged it to the yuan. China has kept the yuan close to 7 yuan to $1 USD for the longest time to bring manufacturing. Their competitive advantage would be gone if the yuan strengthens.
Yuan isn't a free market driven currency. Their central bank uses reserves to balance the yuan's value when needed.
OLPopsAdelphia | 10 days ago
How about we counter threaten to remove all of our military equipment and let their population decide the fate of the Royal Family?
The only reason we have military equipment over there is so the Royal Family can subjugate their own population.
Informal_Drawing | 10 days ago
You should remove all of your military from everywhere that isn't America.
That would show everybody !
AspectSpiritual9143 | 10 days ago
yeah bring democracy to those monarchs
beginner75 | 10 days ago
Why do People post idiotic articles on economics sub? The UAE has a strong military and is perfectly protecting itself by building buried pipelines to the sea of Oman.
gizamo | 10 days ago
It's also a clickbait title. The UAE isn't threatening using the Yuan. They're just saying they need more USD to ensure they can keep processing payments.
NextWeather7866 | 10 days ago
You know, this game of see how long the US and Iran can pressure each other and see who folds first, likely did not take into account how many other countries would fold before either of them..
averysmallbeing | 10 days ago
Oh no it definitely took that into account