The warning
signs are flashing brighter than ever. The scale of money creation in the
United States has reached alarming proportions. With public debt now exceeding US$35
trillion and fiscal deficits continuing to mount, the Federal Reserve faces a
trap of its own making. Keeping interest rates high risks plunging the economy
into recession, while lowering them could reawaken inflation. Either way, the
era of cheap money that once fueled global dominance of the dollar is drawing
to a close.
Now critics openly
say that the so-called “resilient” US economy rests on shaky foundations.
Growth is being financed not by productivity, but by unprecedented monetary
expansion. More than 60 cents of every dollar the federal government spends is
borrowed or printed. This illusion of prosperity masks structural decay — the
same speculative excesses and fiscal irresponsibility that triggered the 2008
financial crisis, now magnified many times over.
The
repercussions are no longer confined to American borders. A growing number of
countries are openly challenging the dollar’s hegemony. The BRICS alliance —
now expanded to include energy-rich nations like Saudi Arabia and the UAE — is
laying the groundwork for a new trade settlement system that bypasses the US
financial network. China is leading the charge, pushing for the yuan in energy
transactions and bilateral trade, while Russia and Iran have turned to local
currency arrangements to circumvent sanctions.
The Gulf
states, long considered the backbone of the petrodollar system, are quietly
rethinking their dependence on the greenback. Deals between Beijing and Riyadh
to price oil in yuan have sent shockwaves through Washington. Once the world’s
major energy producers start accepting payments in other currencies, the
dollar’s status as the global reserve currency will erode faster than expected.
The US,
meanwhile, continues to export inflation through its fiscal recklessness.
Ordinary Americans face rising living costs, while policymakers keep resorting
to debt-financed spending. Analysts warn that if confidence in the dollar
falters, the US could face a sovereign debt crisis of its own — one that no
amount of printing can avert. When foreign creditors and central banks begin to
question Washington’s ability to repay without devaluation, the “safe haven”
myth collapses.
Gold
purchases by central banks have surged to multi-decade highs, underscoring a
quiet but steady return to real assets. The shift is not just financial — it is
geopolitical. The world’s emerging powers are building an alternative order
that no longer depends on US control of money, trade, or technology.
If the
dollar bomb bursts, the consequences will be global and enduring. Markets will
convulse, commodities will reprice, and the old financial hierarchy will
crumble. The illusion of endless American solvency will fade — replaced by a
multipolar monetary world, one no longer bound by the dictates of Washington.
