Heard a crazy conspiracy theory just now:
Suppose EU and China want to suddenly ditch the dollar and switch to trading with their own currencies ala Brazil, in a "En tu, Brute?" moment.
This is not a conspiracy theory.
This is happening, but the wrong people are mentioned here.
Asia wants to create a currency block, and this currency block will have the Yuan as the anchor to it.
Since the Yuan is still pegged to the dollar, that in practice could make the Yuan a co-reserve currency of the world, without the benefits and drawbacks of actually being the reserve currency.
Asian currency block ---> Yuan ---> dollar peg.
So? So what?
The so what is that the unanswered question.
What is the value of the US dollar?
It depends on the Yuan peg.
Will that change?
Possibly. Never say never. Currency values tend to change over time.
Does that mean the Yuan peg (backed by Chinese economy and backed by the Asian block that is forming) is that a hammer over the value of the US dollar?
We are going to freaking find out!
Stay tuned. Come back tomorrow.
Same bat time. Same bat channel.
Very briefly, that is what is going on, IMHO.
