BRICS is an acronym for Brazil, Russia, India, China and South Africa, the emerging economies originally predicted by Goldman-Sachs in 2001 to dominate the world economy by 2050, comprising 48% of the world’s current population. The BRICS fund was created by these countries as an alternative development bank to the International Monetary Fund (IMF).
Contrary to what many may think, the BRICS nations, which concluded their recent meeting in Xiamen, China last Tuesday are not seeking to disrupt the Central Bankers’ debt-based, fiat money system of the IMF. They are actually seeking to get a better seat at the Central Bankers’ table, with their “currency basket” model, which replaces the petrodollar.
China, by far the largest of these economies is the largest stakeholder in the BRICS fund and it is also the biggest crude oil importer in the world. China is expected to launch a yuan-denominated, gold-backed crude oil futures security, in a space where crude oil has only been priced in US dollars since the early 1960s.
We may recall that Iraq was invaded by “Coalition troops” soon after Saddam Hussein began accepting euros for Iraqi oil in February 2003. We may also recall that Libya was razed to the ground by NATO troops shortly before the release of Muammar Gaddafi’s pan-African currency, the golden Dinar.
Given what happened to these two countries and their leaders when they stood up to the monopolistic practices of the West and given the aggravated climate between the West and North Korea, China’s yuan-based futures instrument could easily be construed as a “shot across the bow,” which James Corbett suggests could escalate into “real shots” rather quickly.
Yuan-denominated crude oil has myriad implications. One is that it will enable traders in US/EU-sanctioned territories, such as Russia and Iran to circumvent the petrodollar completely in their crude oil purchases.
It’s a fascinating story that has been coming to a head for several years. James Corbett does a great job with this story.