Squeezing Out the U.S.?

Last Autumn, a British newspaper reported, “In the most profound financial change in recent Middle East history, Gulf Arabs are planning—along with China, Russia, Japan and France—to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar.

Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars.” One Chinese banking source also predicted the Russian ruble would be brought into the “basket” of currencies in the future too. The deadline for converting completely away from the dollar is now eight years away—2018. Obviously missing from those “secret” financial meetings were the bulk of European nations—including Germany and Britain(Independent, October 6, 2010). Little has been run in the popular press since, but this past summer China detached itself from the bilateral exchange rate with the U.S. dollar, instead choosing to compare itself to a “basket” of other currencies. One reason was to deflect attention away from the U.S. dollar (Reuters, July 22, 2010).

Nations of the world are increasingly concerned about the U.S. dollar and spiraling U.S. sovereign debt. The U.S. debt is also acting to polarize nations and even drive some nations together—for example the gulf nations. The Bible makes clear that debt can move one from a position of leadership to one of being a servant (Proverbs 22:7). We appear to be watching this global power-shift occur.