Sanctions and hyperinflation: The future looks bleak for the dollar.

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·@welshstacker·
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Sanctions and hyperinflation: The future looks bleak for the dollar.
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[SOURCE](https://www.bennettinstitute.cam.ac.uk/wp-content/uploads/2022/10/great-divide-tn-1.jpg)</center>

First off, dont think I havent noticed the attention my recent blogs have been getting, this has put a bit of pressure on me to continue to think up interesting and informative blogs to keep you coming back for more. I really do appreciate your comments and upvotes, and if I dont get everything factually correct, please feel free to correct me. Ive been brought to "**task**" on a few points in a previous blog, and honestly do appreciate all the constructive feedback. Its how we grow and learn things we didnt know beforehand. So with that said, lets get down to it and try and keep you entertained for the next 5 minutes.....

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[SOURCE](https://cdn.i-scmp.com/sites/default/files/d8/images/canvas/2021/07/06/7ebad862-c48a-41d5-8db0-6a16a4a457b9_9a99b0be.jpg)</center>

International sanctions are a form of economic and diplomatic pressure used by one or more countries against another country in order to achieve a specific foreign policy objective. Sanctions can take various forms, including restrictions on trade, investment, financial transactions, travel, and the transfer of technology. The goal of sanctions is to modify the behavior of the target country by limiting its access to resources and hindering its ability to participate in the global economy.

Sanctions can be imposed by individual countries, regional organizations, or the United Nations. They are typically imposed in response to actions such as human rights abuses, proliferation of weapons of mass destruction, or interference in the internal affairs of other countries. The exact nature and scope of the sanctions can vary depending on the specific circumstances and the foreign policy objectives of the imposing countries.

International sanctions can have a significant impact on the economy of the targeted country, as they limit its access to resources and markets, and can result in decreased investment and trade. However, sanctions can also have unintended consequences, such as hurting the economies of the imposing countries and the broader global economy.

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[SOURCE](https://cdn.nextgov.com/media/img/cd/2022/10/20/102022sanctionNG/route-fifty-lead-image.jpg?1666280504)</center>

Lets take the recent sanctions imposed on the Russia federation after its invasion of Ukraine. We wont get into the who, what, why and where of all that here, we all have differing opinions on that, but what we can all agree on is that the deaths of innocent people is wrong(on both sides) regardless of your views. 

For me, and from my perspective, sanctions placed on Russia, by the "West", have only sped up the death of the US dollar. The Russian sanctions may now force the hand of its allieces and its close relationship to Brazil, India, China and South Africa (BRICS) to speed up thier own de-dollarisation. Making up 40% of the worlds population, these 5 countries alone registered a GDP of $24.5 trillion, parable to the US ($ 25 trillion) and more than the EU($16.6 trillion.). China and India have negotiated with Russia to circumvent trading in dollars and the ["SWIFT SYSTEM"](https://en.m.wikipedia.org/wiki/SWIFT) and trade between these countries is now booming. Sanctions placed on Russia oil to Europe now only hurts the pockets of Europeans, as petrol prices skyrocket. Oil exports from Russia to India on the other hand have exploded (no pun intended), with trade rising to $38billion from $6.5billion a year earlier. With other countries still willing to trade with Russia fornits vast natural resources and with the BRICS's countries GDP predicted to continue to outperform the westernised countries,  all hope of forcing Russia to retr through sanctions have all but backfired.

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[SOURCE](https://st.adda247.com/https://wpassets.adda247.com/wp-content/uploads/multisite/sites/5/2022/08/19114911/052015US-CHINA-AND-TAIWAN-1.jpg)</center>

Watching sanctions imposed on Russia, the Chinese government must be wondering that when the invasion of Taiwan happens, and it will, will the US try the same thing with the chinease economy??!!?? 

China holds approximately $1.09 trillion in US dollars. This makes China one of the largest holders of US dollars in the world, as many countries hold a portion of their foreign exchange reserves in US dollars as a way to hedge against currency fluctuations and ensure the stability of their own currencies. It's worth noting that the exact amount of US dollars held by China can fluctuate due to a number of factors, including changes in the value of the US dollar and changes in the size of China's foreign exchange reserves. Additionally, the data on the exact amount of US dollars held by China is not publicly available, so the figure mentioned above is an estimate.

China's [one-china policy](https://en.m.wikipedia.org/wiki/One_China) means that the invasion of Taiwan is inevitable and the only thing preventing China from rolling over the straight of Taiwan is the possible threat of similar sanctions apposed on Russia.

In order to combat the threat of sanctions, if I were in charge of the CCP, I would get China to strat "cashing in" their dollar reserves and sending them back to the States. 

<center>![Screenshot_20230207_211232_Chrome.jpg](https://images.hive.blog/DQmPkfjsbKccjMvjyuMvNLnWpPN62cV5LyjbxMLK7gmmoSj/Screenshot_20230207_211232_Chrome.jpg)
[SOURCE](https://www.unews.com.lb/wp-content/uploads/2022/06/China-_-Xi-Points-Directions-to-Solve-Global-Challenges-at-BRICS-Business-Forum-snapshot-20.8.jp)</center>

>"sanctions are a boomerang and a double-edged sword".
Xi Jingping -2022

Now heres a scenario - Imagine if you would, a time where China no longer requires to hold USD, and an alternative method of payment between somenof the fastest growing nations emerged. Without fear of financial sanctions plaved upon the CCP by the USA for the invasion of Taiwan,  notjing can or could stop the Chinease from fulfilling their one-china policy.

$1,090,000,000,000 dollars flooding back to the US, from China alone would send the USD into comllete meltdown. The States would face a hyperinflation like never seen before in the history of "money".

Hyperinflation is a rapid and sustained increase in the general price level of goods and services in an economy over a short period of time. It can occur when the money supply grows too quickly, leading to a decrease in the purchasing power of currency. This can lead to a lack of confidence in the currency and a shift towards holding assets that retain value, such as gold.

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