De-Dollarizing the American Financial Empire

Guns and Butter. July 3, 2019 Imperialism is getting something for nothing. It is a strategy to obtain other countries’ surplus without playing a productive role, but by creating an extractive rentier system. An imperialist power obliges other countries to pay tribute. Of course, America doesn’t come right out and tell other countries, “You have to pay us tribute,” like Roman emperors told the provinces they governed. U.S. diplomats simply insist that other countries invest their balance-of-payments inflows and official central-bank savings in US dollars, especially U.S. Treasury IOUs. This Treasury-bill standard turns the global monetary and financial system into a tributary system. That is what pays the costs of U.S. military spending, including its 800 military bases throughout the world. I’m Bonnie Faulkner. Today on Guns and Butter, Dr. Michael Hudson. ...

Banking Deep Dive

An interview with one of the best in the business, Bonnie Faulkner (Guns and Butter). 2018 marks the 10th anniversary of the stock market crash of 2008; the current financial malaise is the result of the bank bailouts, not the crash; an over-indebted economy cannot be saved unless the banks fail; debt deflation; the magic of compound interest; how pension funds, state and local governments adversely affected by the bank bailouts; growth of the financial extraction FIRE sector (finance, insurance and real estate); quantitative easing; asset price inflation; wealth concentrated at the top in Roman antiquity led to the Dark Age; Eurozone imposition of austerity Greek style; tariffs, economic sanctions and isolationism. This is Guns and Butter. You can’t bail out the banks, leave the debts in place, and rescue the economy. ...

The Commanding Heights

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This is Guns and Butter Suppose a country owes money to another nation’s government or official agency. How can creditors collect, unless there’s an international court and an enforcement system? The IMF and the World Bank were part of that enforcement system and now they’re saying: ‘We’re not going to be part of that anymore. We’re only working for the U.S. State Department and Pentagon. If the Pentagon tells the IMF it’s okay that a country doesn’t have to pay Russia or China, then now they don’t have to pay, as far as the IMF is concerned.’ That breaks up the global order that was created after World War II. The world is being split into two halves: the U.S. dollar orbit, and countries that the U.S. cannot control and whose ...