United

Elon

Elon Musk

<p><strong>The Petrodollar Empire is faltering. Elon Musk knows it and warns that Washington would do well to reduce budget deficits.</strong></p>
<h2 id="wwiii-and-greenbacks">WWIII and Greenbacks</h2>
<p>The dollar is fragile, and Tesla’s CEO knows it. The billionaire <a href="https://x.com/elonmusk/status/1786365165463605754" target="_blank" rel="noopener noreferrer nofollow">stated</a> this Friday that <em>“something must be done about national debt, otherwise the dollar will become worthless.”</em></p>
<div class="my-4">
 <div class="ads " data-page-type="" data-location="1">
 </div>
</div>
<p>This tweet was a response to <a href="https://x.com/MarioNawfal/status/1786362886559814066" target="_blank" rel="noopener noreferrer nofollow">statements</a> by the former National Security Advisor for Donald Trump. General McMaster warns that the world could be <em>“on the brink”</em> of a third world war.</p>
<p><em>“I know it’s a somewhat dramatic statement, but we need to take this risk seriously if we want to avoid the worst-case scenario. Preventing a war is much less costly than having to fight one.”</em></p>
<p>Wise words, except that the general is at the same time calling for a doubling of the defense budget… Knowing that it already reaches nearly 850 billion, which is 20% of all tax revenues.</p>
<p>These figures are such that even the Treasury Secretary Janet Yellen is starting to express her concerns.</p>
<p><em>“I wouldn’t say that I’m concerned about the current situation, but I am worried about where we will go if we do not take steps to reduce the budget deficit,”</em> she stated to the US Congress.</p>
<p>Indeed, missiles, tanks, drones, frigates, are anything but productive investments. On the contrary. Simply, the petrodollar means that the United States can afford it. For now.</p>
<p>This miracle is due to the fact that most of the world’s foreign exchange reserves are invested in American debt. It represents 7,500 billion dollars which, instead of being converted into Saudi riyals, Australian dollars or <a href="https://www.cointribune.com/le-venezuela-vend-son-petrole-en-crypto/" target="_blank" rel="noopener noreferrer nofollow">Venezuelan bolivars</a>, feed into the US debt.</p>
<p>As a result, the dollar remains strong on the foreign exchange market, despite massive budgetary and trade deficits.</p>
<div class="my-4">
 <div class="ads " data-page-type="" data-location="2">
 </div>
</div>
<h2 id="the-end-of-the-exorbitant-privilege">The End of the “Exorbitant Privilege”</h2>
<p>Washington can afford such deficits because the United States forces the whole world to trade in dollars.</p>
<p>As <a href="https://www.cointribune.com/bitcoin-michael-saylor-met-les-point-sur-les-i/" target="_blank" rel="noopener noreferrer nofollow">Michael Saylor</a> says, <em>“even if it’s unspoken, the US nuclear arsenal is taken into account when nations buy Treasury bonds”…</em></p>
<p>The fact that central banks keep their foreign exchange reserves mainly in dollars (in Treasury bonds) allows Americans to enjoy a chronically deficit trade balance without the dollar sinking.</p>
<figure class="wp-block-embed aligncenter is-type-rich is-provider-twitter wp-block-embed-twitter">
 <div class="wp-block-embed__wrapper">
  <div class="entry-content-asset">
   <div class="social-embed-container">
    <blockquote class="twitter-tweet" data-width="500" data-dnt="true">
     <p lang="fr" dir="ltr">Le "privilège exorbitant" du dollar en image : <a href="https://t.co/Fv8xGLWqhr" rel="noopener noreferrer nofollow">pic.twitter.com/Fv8xGLWqhr</a></p>— Nicolas Teterel / PAX (@NTeterel) <a href="https://twitter.com/NTeterel/status/1755972527627632681?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">February 9, 2024</a>
    </blockquote>
    <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
   </div>
  </div>
 </div>
</figure>
<p>Unfortunately for the dollar, the BRICS intend to get rid of it. Saudi Arabia, Russia, and China are over it. US debt held by the Chinese central bank went from 1200 billion in 2018 to 775 billion dollars today.</p>
<p>Even Japan, the leading holder of US debt (1,170 billion $), can hardly accumulate more. The BoJ had to sell this week to stop the hemorrhage of the <a href="https://www.cointribune.com/en/the-yen-collapses-against-bitcoin/" target="_blank" rel="noopener noreferrer nofollow">yen, which has lost 50%</a> of its value against the dollar since 2012.</p>
<p>The following chart shows that it is now the printing press that finances the US budget deficit. The fact that the Fed has to plug the gaps is telling…</p>
<figure class="wp-block-embed aligncenter is-type-rich is-provider-twitter wp-block-embed-twitter">
 <div class="wp-block-embed__wrapper">
  <div class="entry-content-asset">
   <div class="social-embed-container">
    <blockquote class="twitter-tweet" data-width="500" data-dnt="true">
     <p lang="en" dir="ltr">Foreign holders (orange) of US Bonds have been refusing to take on more for quite some time now.<br><br>USA have to print money (green) to fund the deficits. <a href="https://t.co/0BIiWEWSqj" rel="noopener noreferrer nofollow">pic.twitter.com/0BIiWEWSqj</a></p>— Nicolas Teterel / PAX (@NTeterel) <a href="https://twitter.com/NTeterel/status/1786694933430067706?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">May 4, 2024</a>
    </blockquote>
    <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
   </div>
  </div>
 </div>
 <figcaption class="wp-element-caption"><em>“Foreign holders (orange) of American bonds have refused to buy more for some time now.<br>The United States is obliged to print money (green) to finance the deficits.”</em>
 </figcaption>
</figure>
<p>If the world no longer wants to finance US debt, deficits must be reduced, otherwise the dollar will eventually collapse.</p>
<p>It’s either that or doubling military spending in an attempt to scare Russia, China, and the petromonarchies into being forced to buy Treasury bonds. That’s the solution recommended by General McMaster.</p>
<h2 id="h-bitcoin-for-equal-trade">Bitcoin for Equal Trade</h2>
<p>All the wars the United States leads ultimately aim to protect the petrodollar system. That is, the fact that all oil worldwide (80% currently) is sold exclusively in dollars.</p>
<p>US foreign policy revolves entirely around this monetary imperative. The US-led coup in Ukraine in 2014 and the return of war in Europe (<a href="https://www.liberation.fr/international/europe/la-guerre-en-ukraine-aurait-fait-un-500-000-morts-et-blesses-selon-des-officiels-americains-20230818_ZXURHMC2SZCLJA7QRPY2AAWJPY/" target="_blank" rel="noopener noreferrer nofollow">500,000</a> dead in Ukraine) aimed to punish Russia for making de-dollarization a priority for the BRICS.</p>
<p>The unconditional support for Israel is no exception. The goal is to scare Arab nations into deterring them from selling their oil in rupees and yuan.</p>
<p>In short, the United States has two choices:</p>
<p>1) Accept to trade on equal terms, which means reducing their enormous deficits and tightening their belts a bit.</p>
<p>2) Increase conflicts to provoke regime changes and/or <a href="https://www.cointribune.com/en/thunderclap-for-the-dollar/" target="_blank" rel="noopener noreferrer nofollow">default on debt owed to “rebel” nations</a>.</p>
<p>Considering the United States and Europe “froze” <a href="https://www.cointribune.com/en/the-300-billion-rubles-will-soon-be-seized/" target="_blank" rel="noopener noreferrer nofollow">300 billion</a> euros and dollars belonging to Russia. <a href="https://www.cointribune.com/en/the-united-states-threatens-to-disconnect-china-from-the-dollar/" target="_blank" rel="noopener noreferrer nofollow">Not repaying China would dig the dollar’s grave</a>.</p>
<p>The world will then need a new international reserve currency. And what better than bitcoin. It is both a currency and a payment network (which therefore does not need SWIFT).</p>
<p>Stateless, uncensorable, and existing in an absolutely fixed quantity, it would be the ideal solution to ease international relations.</p>
<p>Because let’s face it, there will not be a third world war, let’s be serious. The Americans need to reduce their standard of living, full stop.</p>

Elon Musk warns of the collapse of the dollar

Table of Contents

Cointribune EN

Other articles published on May 5, 2024

Top 5 Trending Crypto Coins to Buy Right Now

US Authorities Target Specific Cryptocurrencies: Impact on Bitcoin (BTC) and Ethereum (ETH) Marke...

Crypto Investments On A 3-Week Outflow Streak, Borroe Finance ($ROE) Could Explode At Launch Desp...

First Altcoins BLP, PEPE, BONK Rally: A Long-Term Uptrend or Short-Lived Surge?

Ripple CEO Asserts XRP and ETH are Not Securities: Key Highlights from Fox Business

$60K Target for $BTC Traders as This New Memecoin Defies the Downturn

Join our free newsletter for daily crypto updates!