Sequestering $300 billion Russian dollars and threatening to use them to fund Ukraine’s war against Russia destroyed the trust that’s essential for a currency that’s held out as the reserve currency.
From James Rickards at dailyreckoning.com:
Janet Yellen gave a speech on Sept. 26 at the 2024 U.S. Treasury Market Conference in New York. The speech was largely about risks in the banking system and the market for U.S. Treasury debt.
In a pre-speech interview with Politico, Yellen was asked about risks related to a smooth presidential transition in this election cycle. While that may seem like a straightforward question, it contained a particular bias that somehow Donald Trump, win or lose, might make the presidential transition difficult.
Difficulties could arise if Trump loses and claims the election was “rigged” or if Trump wins and radical groups like antifa commence violent protests. My estimate is that the former is unlikely, and the latter is far more likely but Trump haters in the media will take the opposite view.
Yellen replied, “It really is essential to our having a democratic system and a democratic government, and one of the tremendous strengths of our financial system is that it is based on strong institutions and the rule of law.”
While this statement may seem reasonable on its face, it was Yellen’s thinly disguised way of saying that Donald Trump’s actions on Jan. 6, 2021, and possible similar acts on Jan. 6, 2025, are a threat to the “rule of law” and therefore a danger to the stability of the financial system.
There are many forces at work in this statement by Yellen. In the first instance, this is an example of the Biden-Harris administration “all of government” approach.