A bit slow on the uptake, Madame Treasury Secretary but interesting for such a senior O'Biden-Harris Administration figure to say so.
From Agence France-Presse, April 16:
Economic sanctions imposed on Russia and other countries by the United States put the dollar's dominance at risk as targeted nations seek out an alternative, Treasury Secretary Janet Yellen said Sunday.
"There is a risk when we use financial sanctions that are linked to the role of the dollar that over time it could undermine the hegemony of the dollar," Yellen said on CNN.
"Of course, it does create a desire on the part of China, of Russia, of Iran to find an alternative," she told the network's Fareed Zakaria in an interview. "But the dollar is used as a global currency for reasons that are not easy for other countries to find an alternative with the same properties....
....MUCH MORE
Here's the introduction to a post written the day after Russia invaded Ukraine:
Reminder: "One thing and one thing alone enables global dominance...."
Following up on "The Alphaville Long Read On SWIFT and Russia (and reserve currency status)", the reason I threw the "reserve currency" bit into the headline is: any attempt to exclude Russia from SWIFT effectively de-dollarizes their external transactions and leads to the implementation of alternative payment messaging systems.
Although the U.S. currently has reserve currency hegemony, both the EU and China want to be the next currency hegemon and some very bright people understand that beyond the headlines are some profound effects on world power.
As a side note on effects behind the headlines, if the reader is curious as to why Justin Trudeau reversed his decision to use the Emergency Act, even though he had just won a (party-line) vote ratifying his initial action, my guess is someone very high up in the ultimate corridors of power, meaning Toronto rather than Ottawa, explained what capital flight meant, both in theory and in practice....
And probably related to Secretary Yellen's comments, Sunday's: "CIA director says US no longer 'big kid on the geopolitical block'" . I have no idea why the administration is pitching this narrative but I'm sure we will find out.
