RE: BRICS Claim They Want To Set Up A Reserve Currency

Oh man, this is the type of topics I live for. Been studying Russian, Brazilian, Chinese, and South African economies & currencies for a while now, and there are several factors that will ultimately HURT any attempt at creating a BRICS-centric reserve currency.

Whatever you do, don't ask the South African government why it can't keep the lights on. They don't like admitting that they have a failed electrical grid that has regular outages, and it's 100% centrally-controlled and operated mostly by Eskom.

Brazil has one of the largest middle classes in the Emerging Markets. I've been a longterm investor in certain Brazilian equities since 2019, and one thing that there is no shortage of, is growth. Insane Growth. So much growth in 3 years that it puts the rest of the world to shame. Yet, Brazil's economy, overall, has been in a very poor condition for a long time. There's systemic corruption in the Brazilian government, including its financial regulators.

China - just look at what the CCP did to Jack Ma, their MOST-SUCCESSFUL BUSINESSMAN AND JOB-CREATOR EVER. They absolutely robbed him of his wealth HE helped build. China's real estate market is imploding as we speak. Evergrande just missed a $300B debt restructuring agreed-upon payment deadline. The stock was halted months ago. Hundreds of billions of dollars in equity were wiped out. The CCP has spent the past 2 years punishing Tencent and Alibaba for being successful and providing good products to the Chinese population. Is that the kind of stable system that good, sound money is built on? No way in hell. The Yuan is just as much a fiat paper sham as the rest of the fiat currencies.

Russia's economy is going through a transition period. The one thing that the Russian central bank did that was extremely intelligent, was dumping their USD-denominated debt. They are the only country I know of to do that. Russia's also been stacking physical gold bullion faster than any other country.

I honestly haven't studied India's economy as closely as the others. It's still very much in its infancy in terms of financialization, and there's still plenty of state-run and state-controlled enterprises that dominate communications. You can't have state-controlled communication networks being the backbone of a system - that's bound to fail eventually.

Creating a "reserve currency" based on a basket of the Brazilian Real, the Russian Ruble, the Indian Rupee, the Chinese Yuan, and the South African Rand is a bad idea from the start. I had wrongly-assumed that their reserve currency proposal would actually have real hard money backing it (such as gold or silver), but clearly, that would put too much power into the hands of regular people who own precious metals - and the communists in Europe and Asia can't have that :/

Posted Using LeoFinance ^Beta