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Four More Mega-Banks Join The Anti-Dollar Alliance

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  • Blockchain technology is an entirely electronic digital solution ie. Cashless system.
  • Four More Mega-Banks Join The Anti-Dollar Alliance
    by Simon Black,  
    That was fast. Yesterday I told you how a consortium of 15 Japanese banks had just signed up to implement new financial technology to clear and settle international financial transactions.

    This is a huge step. Right now, most international financial transactions must pass through the US banking system’s network of correspondent accounts. This gives the US government an incredible amount of power… power they haven’t been shy about using over the last several years.

    2014 was one of the first major watershed moments when the Obama administration fined French bank BNP Paribas $9 billion for doing business with countries that the US doesn’t like– namely Cuba and Iran. It didn’t matter that this French bank wasn’t violating any French laws.

    Nor did it matter that only months later the President of the United States inked a sweetheart nuclear deal with Iran and flew down to Cuba to attend a baseball game with his new BFFs. BNP had to pay up. A French bank paid $9 billion because they violated US law. And if they didn’t pay, the US government threatened to kick them out of the US banking system.

    $9 billion hurt. But being kicked out of the US banking system would have been totally crippling. Big international banks in particular cannot function if they don’t have access to the US banking system. 

    As long as the US dollar remains the world’s dominant reserve currency, major banks must able to clear and settle US dollar transactions if they expect to remain in business. This means having access to the US banking system… the gatekeeper of the US dollar.

    But having watched BNP Paribas get blackmailed into paying an absurd $9 billion fine to the US government, the rest of the world’s mega-banks knew instantly that their heads could be next ones on the chopping block. So they started working on contingency plans.

    Blockchain technology provided an elegant solution. Instead of passing funds through the US banking system’s costly and inefficient network of correspondent accounts, blockchain technology provides an easy way for banks to send payments directly to one another. I cannot understate how important this technology is. Blockchain may very well be what neutralizes the US government’s domination of the global financial system.

    If foreign banks are able to transact directly with one another without having to go through the US banking system, then why would they need to park trillions of dollars in the United States? They wouldn’t.

    Adoption of this technology could cause a gigantic vacuum of deposits out of the US banking system. US banks would take a big hit. And the US government would have far fewer foreign buyers to sell its ever-expanding piles of debt. Make no mistake, the adoption of this technology is a game-changing development with far-reaching implications. And it’s happening very quickly.

    If these mega-banks can hit their milestones, they’ll launch commercially in eighteen months.

    read more.

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August 26, 2016 - Posted by | Economics | , , , , , , , , , ,

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