I am not sure BRICS currency would take off. At best, BRICS can collaborate on academic and tech. And maybe some trade agreements. BRICS consists of three countries pursuing aggressive nationalist policies that can cause friction within the group. China-India border friction that erupted recently made India deliberately strip SCO of its usefulness. Russia is a unifying force for BRICS, because, Russia is otherwise isolated. Too much politics for a common currency. Remember, Brexit? Britain never accepted the Euro. India will weaken any grouping that strengthens China and weakens USA. India has its strategic reasons. Most smaller nations want to join BRICS. Russia and China are excited about it. But India and Brazil see no value in such an expansion.
Which currency do you think will outperform?
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I am not sure BRICS currency would take off. At best, BRICS can collaborate on academic and tech. And maybe some trade agreements. BRICS consists of three countries pursuing aggressive nationalist policies that can cause friction within the group. China-India border friction that erupted recently made India deliberately strip SCO of its usefulness. Russia is a unifying force for BRICS, because, Russia is otherwise isolated. Too much politics for a common currency. Remember, Brexit? Britain never accepted the Euro. India will weaken any grouping that strengthens China and weakens USA. India has its strategic reasons. Most smaller nations want to join BRICS. Russia and China are excited about it. But India and Brazil see no value in such an expansion.
Great analysis
Russian ruble has gained over 20% against the US dollar since the start of the year, due to a number of factors, including high oil and gas prices, as well as capital controls imposed by Russia to keep money inside the country.
Other currencies that have outperformed the US dollar in recent days include the Turkish lira, the Brazilian real, and the Mexican peso. These currencies have all benefited from rising commodity prices and increased demand for emerging market assets.
Other currencies that have outperformed the US dollar in recent days include the Turkish lira, the Brazilian real, and the Mexican peso. These currencies have all benefited from rising commodity prices and increased demand for emerging market assets.
Good analysis, but once they get Saudi Arabia and other OPEC producing countries to accept BRICS then it's basically checkmate.
Civil war in Saudi Arabia would start the very next day if the CIA presses the button
BRICs backed by gold will win. Hands down. Already US bonds are downgraded and no longer counted as risk-free investments.
The US will try to resist, but in the end we may see two world/reserve currencies in existence. Blue-chip cryptos AND BRICs. Dalio has already mentioned this is not impossible to do, there are no rules that state it can't be viable.
No one is going to want to settle for non-backed FIAT anymore, given a gold-backed alternative or other -aside from some aging boomers-.
But... give it another half-century or more, and I'm sure the BRICs nations will start doing the same debasement as the Romans did with the Denarius.
The US will try to resist, but in the end we may see two world/reserve currencies in existence. Blue-chip cryptos AND BRICs. Dalio has already mentioned this is not impossible to do, there are no rules that state it can't be viable.
No one is going to want to settle for non-backed FIAT anymore, given a gold-backed alternative or other -aside from some aging boomers-.
But... give it another half-century or more, and I'm sure the BRICs nations will start doing the same debasement as the Romans did with the Denarius.
Ph1l, really? Put those factual charts away and let him live his fantasies!
You're so mean.
BTC
Gold backed currency? Really? Do you know that there is not enough floating gold in the world to back the currency that is in circulation for several countries and that too if that currency is likely to gain more acceptance? Total gold reserves in the world are estimated to be $13T. Estimated US dollars in circulation: USD1.5T. Now if any country uses gold reserves for matching its circulated currency, it has to first acquire that much gold and then print limited currency to match that gold and that limitation reduces currency in circulation and dents its GDP. Nah! Not going to work. If a major economy is going to announce such a thing, gold prices can shoot up. Imagine BRICS together announcing such a thing. I don't think this is going to happen.
Another point to consider is that if a country is entering into a currency union with a group of countries, it is foregoing its freedom of setting its monetary policy. Which BRICS country is going to do that? EU countries did something like this because they also have a common market. Which country would like to have a common market with China that pursues predatory business practices? Do you know India banned TikTok and several other Chinese apps across the country about 3 years ago? It is not like the USA where the ban is limited to just governmental usage. Do you know that India has laws with respect to foreign investments if they are backed by Chinese nationals and those investments are scrutinized more rigorously? Do you know India rejected USD 1B investment by BYD in building car and battery factories in India? Do you know India is forcing MG Motors which is a Chinese owned British brand to give up control of its India factory to a local major partner? You think India will get into such a currency and economic union? Without India, BRICS will lose value for Russia. India is a non-aligned country and losing this country will be a loss of face for BRICS. If India exits BRICS, then BRICS will be more like just another Warsaw Pact.
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