While the whole world was watching football (or soccer as it is called in some countries) an interesting BRICS meeting took place in Brazil that could easily change the way international trades could be done (1) .
What is BRICS?
BRICS is the acronym for an association of five major emerging national economies: Brazil, Russia, India, China, and South Africa (2). These countries represent an impressive 40% part of the world population, and an even more impressive 18% part of the total world economy (3).
One focus of the BRICS meeting is to assist their member countries in international trade solutions, since they believe the IMF and World Bank have been favoring the Petrodollar too much (4). This is despite agreements, these two monetary entities acknowledged, to assist countries with non-US Dolar currencies as well (5). The freshly named New Development Bank (NDB) is designed to provide both development finance and balance of payments funding on a grand global scale — a clear potential rival to the International Monetary Fund the World Bank (6).
Since many international financial transactions are currently processed in NYC because they involve USD as the currency, a shift away from the USD could have major consequences for SWIFT settlements. The dollar has been a major part of most post WWII international transactions as well as since the beginning of the SWIFT system (7).
Russia, which is part of BRICS, is adding additional headaches to international trades involving the US Dollar, because of their oil production. (8)
As new developments take place, we will continue to provide our readers with (potential) changes in internation trade credits, and (recommended) assets to be used in their international transactions.
With France just having its “Black Saturday,” and joining the countless other European countries shut-down of most economic activities due to their summer vacation, from all of us here at Confirmed Funds, we wish you safe vacation travels, where ever those might be.
Related previous posts on this blog