The policies of President Joe Biden’s administration are undermining the strength of the U.S. dollar and jeopardizing America’s worldwide influence, economists told the Daily Caller News Foundation.- Economists expressed concern regarding the possible consequences of Biden’s policies, highlighting the threat to the U.S. dollar’s global reserve currency status.
- “Losing reserve currency status … would mean 70 years of deficits flooding back to the U.S., all competing with existing dollars held domestically to buy goods and services,” Heritage Foundation economist E.J. Antoni told the DCNF. “That’s a hyperinflation scenario. It also means we could no longer export inflation abroad, so we’d bear the full cost of future inflation ourselves.”
President Joe Biden’s administration’s policies are weakening the standing of the U.S. dollar and threatening America’s global influence, according to economists who spoke to the Daily Caller News Foundation.
Economists told the DCNF about the potential repercussions of Biden’s policies, expressing serious concerns that the U.S. dollar’s global reserve currency status is at risk. The result could be hyperinflation, spending cuts and other severe consequences for the country; economists concurred that the actions taken by the Biden administration and the Federal Reserve have contributed to the depreciation of the U.S. dollar, but there was a divergence of opinion regarding the extent of the risk.
“The Biden administration has taken so many actions to dethrone King Dollar that it would be difficult to rank them all by their destructiveness,” Heritage Foundation economist E.J. Antoni told the DCNF.
As the reserve currency, the U.S. dollar is involved in the majority of business on the planet. International trade typically takes place in dollars.
“Losing reserve currency status … would mean 70 years of deficits flooding back to the U.S., all competing with existing dollars held domestically to buy goods and services,” Antoni told the DCNF. “That’s a hyperinflation scenario. It also means we could no longer export inflation abroad, so we’d bear the full cost of future inflation ourselves.”
Economists particularly criticized the Biden administration’s sanctions against Russia as a punishment for invading Ukraine. The U.S. seized Russian central bank assets and participated in banning Russian banks from the Society for Worldwide Interbank Financial Telecommunication (SWIFT), the global financial messaging system, in February 2022.
The U.S. and its allies have taken over $300 billion worth of foreign currency assets held by the Russian central bank, which had been frozen due to sanctions, according to Reuters. A substantial portion of the seized assets are now located at the Federal Reserve Bank of New York, although they are still owned by Russia.
Confiscating Russia’s central bank dollar reserves was “the single biggest Biden mistake,” Peter St. Onge, an economist at the Heritage Foundation, told the DCNF. “It put dozens of countries on notice that if the U.S. doesn’t like your policy, we’ll crash your economy and seize your dollars. In other words, dollars now carry a unique risk.”
Further, removing Russian banks from SWIFT “signaled to countries not politically aligned with the United States that we are willing to use the dollar as a political weapon, which made them reluctant to hold U.S. dollars,” Dr. Thomas Hogan, senior research faculty at the American Institute for Economic Research (AIER), told the DCNF.
Treasury Secretary Janet Yellen lauded the sanctions, stating they will be effective in preventing Russia from destroying Europe without hurting the U.S. “Our actions, taken in coordination with partners and allies, will degrade Russia’s ability to project power and threaten the peace and stability of Europe,” Yellen said at the time. “We are united in our efforts to hold Russia accountable for its further invasion of Ukraine while mitigating impacts to Americans and our partners.”
These sanctions against Russia have led countries to devise alternatives to the U.S. dollar, AIER economist Peter Earle told the DCNF.
China, Russia, Saudi Arabia, the United Arab Emirates and Brazil began trading in the Chinese Yuan and the Russian ruble instead of the U.S. dollar in 2023, according to NPR.
“No country wants to suddenly be unable to engage in international trade if they have a dispute or fall into disfavor with Washington D.C.,” Earle explained.
Additionally, Russian state-backed media has reported that Brazil, Russia, India, China and South Africa (BRICS) will soon announce a gold-backed currency.
“A gold-backed currency represents a real threat to all fiat monies, including the dollar,” Antoni told the DCNF.
“The real source of our power is the dollar,” Peter Schiff, the chief economist and global strategist of Euro Pacific Capital, told the DCNF. “If the dollar wasn’t the reserve currency, government spending would have to be slashed.”
Inflation is another reason the dollar’s value is weaker, with economists blaming Biden and the Federal Reserve’s policy. The Consumer Price Index (CPI), a broad measure of prices of everyday goods such as energy and food, increased 3.0% on an annual basis in June, according to the Bureau of Labor Statistics.
“The Biden administration’s spending, borrowing, and printing of trillions of dollars gave us 40-year-high inflation,” Antoni told the DCNF. “Such devaluation of the dollar has shaken foreigners’ confidence in the currency’s stability over time.”
However, Hogan told the DCNF that “the strength of the U.S. dollar is really determined by monetary policy of the U.S. Federal Reserve … the Fed creates inflation.”
“I don’t think inflation is Biden’s fault,” Hogan added. “In terms of inflation, I blame it entirely on Fed officials, not on the Biden administration.”
Hogan also was more optimistic, stating, “Luckily for us, it’s still less bad than in many other countries, which has kept the international value of the dollar relatively stable. Although dollar dominance has declined in recent years, the magnitude is small. There is no other serious contender for widespread use in international exchange.”
“Even though I would like the United States to have a more stable currency (less inflation), a stronger economy (less regulation), and a more reliable government, we are still better on those margins than pretty much every other country in the world,” Hogan added. “Unless China or Russia suddenly gets free markets, strong property rights, and a stable currency, they do not present a serious threat to U.S. dollar dominance.”
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Earle was also optimistic about the dollar’s future as the reserve currency. “Ejecting the dollar from the top spot as the global reserve currency is highly unlikely and would take decades,” he told the DCNF.
Antoni disagreed. “It’s difficult to overstate just how calamitous this would be and how quickly it could happen,” he said.
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Five Things New “Preppers” Forget When Getting Ready for Bad Times Ahead
The preparedness community is growing faster than it has in decades. Even during peak times such as Y2K, the economic downturn of 2008, and Covid, the vast majority of Americans made sure they had plenty of toilet paper but didn’t really stockpile anything else.
Things have changed. There’s a growing anxiety in this presidential election year that has prompted more Americans to get prepared for crazy events in the future. Some of it is being driven by fearmongers, but there are valid concerns with the economy, food supply, pharmaceuticals, the energy grid, and mass rioting that have pushed average Americans into “prepper” mode.
There are degrees of preparedness. One does not have to be a full-blown “doomsday prepper” living off-grid in a secure Montana bunker in order to be ahead of the curve. In many ways, preparedness isn’t about being able to perfectly handle every conceivable situation. It’s about being less dependent on government for as long as possible. Those who have proper “preps” will not be waiting for FEMA to distribute emergency supplies to the desperate masses.
Below are five things people new to preparedness (and sometimes even those with experience) often forget as they get ready. All five are common sense notions that do not rely on doomsday in order to be useful. It may be nice to own a tank during the apocalypse but there’s not much you can do with it until things get really crazy. The recommendations below can have places in the lives of average Americans whether doomsday comes or not.
Note: The information provided by this publication or any related communications is for informational purposes only and should not be considered as financial advice. We do not provide personalized investment, financial, or legal advice.
Secured Wealth
Whether in the bank or held in a retirement account, most Americans feel that their life’s savings is relatively secure. At least they did until the last couple of years when de-banking, geopolitical turmoil, and the threat of Central Bank Digital Currencies reared their ugly heads.
It behooves Americans to diversify their holdings. If there’s a triggering event or series of events that cripple the financial systems or devalue the U.S. Dollar, wealth can evaporate quickly. To hedge against potential turmoil, many Americans are looking in two directions: Crypto and physical precious metals.
There are huge advantages to cryptocurrencies, but there are also inherent risks because “virtual” money can become challenging to spend. Add in the push by central banks and governments to regulate or even replace cryptocurrencies with their own versions they control and the risks amplify. There’s nothing wrong with cryptocurrencies today but things can change rapidly.
As for physical precious metals, many Americans pay cash to keep plenty on hand in their safe. Rolling over or transferring retirement accounts into self-directed IRAs is also a popular option, but there are caveats. It can often take weeks or even months to get the gold and silver shipped if the owner chooses to close their account. This is why Genesis Gold Group stands out. Their relationship with the depositories allows for rapid closure and shipping, often in less than 10 days from the time the account holder makes their move. This can come in handy if things appear to be heading south.
Lots of Potable Water
One of the biggest shocks that hit new preppers is understanding how much potable water they need in order to survive. Experts claim one gallon of water per person per day is necessary. Even the most conservative estimates put it at over half-a-gallon. That means that for a family of four, they’ll need around 120 gallons of water to survive for a month if the taps turn off and the stores empty out.
Being near a fresh water source, whether it’s a river, lake, or well, is a best practice among experienced preppers. It’s necessary to have a water filter as well, even if the taps are still working. Many refuse to drink tap water even when there is no emergency. Berkey was our previous favorite but they’re under attack from regulators so the Alexapure systems are solid replacements.
For those in the city or away from fresh water sources, storage is the best option. This can be challenging because proper water storage containers take up a lot of room and are difficult to move if the need arises. For “bug in” situations, having a larger container that stores hundreds or even thousands of gallons is better than stacking 1-5 gallon containers. Unfortunately, they won’t be easily transportable and they can cost a lot to install.
Water is critical. If chaos erupts and water infrastructure is compromised, having a large backup supply can be lifesaving.
Pharmaceuticals and Medical Supplies
There are multiple threats specific to the medical supply chain. With Chinese and Indian imports accounting for over 90% of pharmaceutical ingredients in the United States, deteriorating relations could make it impossible to get the medicines and antibiotics many of us need.
Stocking up many prescription medications can be hard. Doctors generally do not like to prescribe large batches of drugs even if they are shelf-stable for extended periods of time. It is a best practice to ask your doctor if they can prescribe a larger amount. Today, some are sympathetic to concerns about pharmacies running out or becoming inaccessible. Tell them your concerns. It’s worth a shot. The worst they can do is say no.
If your doctor is unwilling to help you stock up on medicines, then Jase Medical is a good alternative. Through telehealth, they can prescribe daily meds or antibiotics that are shipped to your door. As proponents of medical freedom, they empathize with those who want to have enough medical supplies on hand in case things go wrong.
Energy Sources
The vast majority of Americans are locked into the grid. This has proven to be a massive liability when the grid goes down. Unfortunately, there are no inexpensive remedies.
Those living off-grid had to either spend a lot of money or effort (or both) to get their alternative energy sources like solar set up. For those who do not want to go so far, it’s still a best practice to have backup power sources. Diesel generators and portable solar panels are the two most popular, and while they’re not inexpensive they are not out of reach of most Americans who are concerned about being without power for extended periods of time.
Natural gas is another necessity for many, but that’s far more challenging to replace. Having alternatives for heating and cooking that can be powered if gas and electric grids go down is important. Have a backup for items that require power such as manual can openers. If you’re stuck eating canned foods for a while and all you have is an electric opener, you’ll have problems.
Don’t Forget the Protein
When most think about “prepping,” they think about their food supply. More Americans are turning to gardening and homesteading as ways to produce their own food. Others are working with local farmers and ranchers to purchase directly from the sources. This is a good idea whether doomsday comes or not, but it’s particularly important if the food supply chain is broken.
Most grocery stores have about one to two weeks worth of food, as do most American households. Grocers rely heavily on truckers to receive their ongoing shipments. In a crisis, the current process can fail. It behooves Americans for multiple reasons to localize their food purchases as much as possible.
Long-term storage is another popular option. Canned foods, MREs, and freeze dried meals are selling out quickly even as prices rise. But one component that is conspicuously absent in shelf-stable food is high-quality protein. Most survival food companies offer low quality “protein buckets” or cans of meat, but they are often barely edible.
Prepper All-Naturals offers premium cuts of steak that have been cooked sous vide and freeze dried to give them a 25-year shelf life. They offer Ribeye, NY Strip, and Tenderloin among others.
Having buckets of beans and rice is a good start, but keeping a solid supply of high-quality protein isn’t just healthier. It can help a family maintain normalcy through crises.
Prepare Without Fear
With all the challenges we face as Americans today, it can be emotionally draining. Citizens are scared and there’s nothing irrational about their concerns. Being prepared and making lifestyle changes to secure necessities can go a long way toward overcoming the fears that plague us. We should hope and pray for the best but prepare for the worst. And if the worst does come, then knowing we did what we could to be ready for it will help us face those challenges with confidence.
