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→Petrodollar
The U.S. sold dollars needed for international transactions by issuing Treasury debt, which is a universally fungible international medium of exchange. Virtually all transactions for oil globally had been conducted in dollars until late 2022 when Saudi Arabia began accepting [[Chinese]] yuan. This gave the U.S. an “exorbitant privilege” in that it could issue an unlimited stream of Treasury debt to the world. One of the consequences of this arrangement is that it has allowed the U.S. to spend far beyond its means, running up $32 trillion of debt since 1980, when its [[national debt]] stood at a mere $1 trillion.
The U.S. sold dollars needed for international transactions by issuing Treasury debt, which is a universally fungible international medium of exchange. Virtually all transactions for oil globally had been conducted in dollars until late 2022 when Saudi Arabia began accepting [[Chinese]] yuan. This gave the U.S. an “exorbitant privilege” in that it could issue an unlimited stream of Treasury debt to the world. One of the consequences of this arrangement is that it has allowed the U.S. to spend far beyond its means, running up $32 trillion of debt since 1980, when its [[national debt]] stood at a mere $1 trillion.
When the [[Federal Reserve]] raised [[interest rate]]s to take care of U.S. needs, it made [[capitalism|capital]] flow out of other countries, and the value of their currencies fall, forcing [[inflation]] on them. Not a single country in the world was left untouched. Many countries did not want to be held hostage to the implicit and explicit negative consequences of dollar [[hegemony]], and wanted to remove the “exorbitant privilege” that they believed the U.S. abused to their individual and collective detriment.
When the [[Federal Reserve]] raised [[interest rate]]s to take care of U.S. needs, it made [[capital flight|capital flow out]] of other countries, and the value of their currencies fall, forcing [[inflation]] on them. Not a single country in the world was left untouched. Many countries did not want to be held hostage to the implicit and explicit negative consequences of dollar [[hegemony]], and wanted to remove the “exorbitant privilege” that they believed the U.S. abused to their individual and collective detriment.
On June 12, 2024, BRICS News [[tweet]]ed, "Saudi Arabia's 50-year-old petrodollar agreement with the United States has expired, with no new agreement in place. Saudi Arabia will now sell oil in multiple currencies, including the Chinese RMB, [[Euro]]s, [[Yen]], and Yuan, instead of exclusively in US dollars."<ref>[https://twitter.com/BRICSinfo/status/1801005240658858443 BRICS News], Jun 12, 2024. twitter.com/BRICSinfo</ref>
On June 12, 2024, BRICS News [[tweet]]ed, "Saudi Arabia's 50-year-old petrodollar agreement with the United States has expired, with no new agreement in place. Saudi Arabia will now sell oil in multiple currencies, including the Chinese RMB, [[Euro]]s, [[Yen]], and Yuan, instead of exclusively in US dollars."<ref>[https://twitter.com/BRICSinfo/status/1801005240658858443 BRICS News], Jun 12, 2024. twitter.com/BRICSinfo</ref>
When dollars flow back into the United States from abroad, they are most often used to purchase [[US]] [[stock market|stocks]] or [[real estate]]. This makes various stock indexes on [[Wall Street]] more of a reflection of the [[globalism|global economy]] than as it traditionally has been interpreted as a reflection of the jealth of the US domestic economy. Likewise, the purchase and control of real estate by foreign principals is of concern to most US states and localities.
===De-dollarization===
===De-dollarization===