June 24, 2024
Jim Rickards Warns of New U.S. Congressional Initiative and its Implications for Global Currencies
Policy & Regulation

Jim Rickards Warns of New U.S. Congressional Initiative and its Implications for Global Currencies

Renowned economist and best-selling author Jim Rickards has raised concerns regarding a new U.S. congressional initiative proposing the confiscation of Russian assets to reimburse itself for aid provided to Ukraine. Rickards believes that if this legislation is enacted, it could signal to the international community the necessity for creating new currencies, potentially impacting the dominance of the U.S. dollar.

The “Make Putin Pay” Act, introduced by Georgia Rep. Rich McCormick, aims to extract $100 billion from the $330 billion in Russian assets currently frozen in the U.S. This money would be allocated to cover the aid extended to Ukraine. An additional $200 billion is designated to fund Ukraine’s assistance until the conflict reaches a resolution. This approach would seemingly reduce the U.S.’s financial support for Ukraine using these frozen assets.

Jim Rickards expressed reservations about McCormick’s proposal, particularly concerning the potential consequences of confiscating assets rather than merely freezing them. He stated:

Freezing assets is one thing. Confiscating them is another. If the U.S. goes ahead with the Republican call to steal Russian assets, the drive to create new currencies will go into overdrive.

The bill, however, justifies these actions by emphasizing the need to confront authoritarian regimes for the survival of Western civilization and to support Ukraine responsibly and effectively.

Rickards is not alone in his prediction that the ongoing reliance on the U.S. dollar will transform the global economic landscape in the future. Another American economist, Jeffrey Sachs, anticipates the end of dollar hegemony in the next decade due to the U.S.’s use of the financial system to achieve geopolitical goals. Sachs suggests that central bank digital currencies (CBDCs), digital variants of existing fiat currencies, will play a pivotal role in replacing the dollar as the basis for international payments.

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