The upcoming BRICS summit in Kazan on October 22nd to 24th may well accelerate the beginning of the end of the dollar as the world currency.

This summit will host the heads of state of the ten current member states as well as other world leaders including the Secretary General of the UN. At the same time Algeria has been welcomed as a new member of the New Development Bank, which is the BRICS replacement for the IMF and World Bank for the current and future members of BRICS. Behind these moves is the growing anger around the Global South that the US and its western subservient acolytes have seen fit to weaponise the dollar by confiscating (stealing) the dollar reserves of countries such as Libya, Venezuela and Russia that the West seeks to damage or destroy.

In addition, the US has been imposing financial sanctions through elimination of access to the SWIFT international banking settlement system to eliminate the capacity of those countries to access the products and services that their populations need. This is an unequivocal form of collective punishment (illegal at international law) of the peoples of countries such as Russia, Barbados, Chad, Haiti, Iran, Yemen and Syria. Use of the power over the Swift system to punish the people of these and other countries has been the impetus for the BRICS countries to develop a system not controlled by the US and that makes settlements in their own or a neutral currency.

Russia and Iran have already developed and linked their own systems for handling financial messaging between countries. This is seen by the BRICS as the forerunner of a system for all the BRICS members and for other countries that wish to escape the in some cases existential threat posed to them by the US control of SWIFT. The US has been increasingly using the SWIFT system as a form or non-military warfare against them to threaten their economic sovereignty and survival. As a result, currently over 60% of the trade between Russia and Iran is handled now in their own currencies. That has been accompanied by substantial increases in trade between the two.

In the last 13 years Chinese international settlements in the Renminbi have gone from 0.3% to 52.9% of total payments. Other BRICS nations are seeing the benefits and are keen to join the new system. Ernest Hemingway in his book The Sun also Rises has his character answer the question: “How did you go bankrupt? Two ways, gradually and then suddenly” That could well be the epitaph for the US dollar.

BRICS is also developing close relations with other economic blocs outside the West and countries are lining up to join. There are around 60 countries from the Global South that have expressed interest in joining BRICS and removing themselves from the dollar system. Should all these countries join, BRICS will likely constitute well over 65% of the world’s population. When that happens, as it will, the increasing number of countries that fear that the US will choose to do the same to them as it has to others, provides the incentive to join. At that point the move to achieve financial independence and to eliminate those risks will become unstoppable.

Central bank digital currencies and gold are being substituted for holdings by those central banks of US dollars as confidence in the safety of the dollar system declines precipitously. China and Russia are leading that movement with continuing and growing purchases of gold and in the case of China, massive sales of US dollars. Janet Yellen’s recent China visit to brow-beat the Chinese into reversing their sales of US dollars for gold led immediately after her departure, to the Chinese increasing their sales of dollars and purchases of gold.

For a currency to replace the US dollar it must offer greater safety and reliability. Thousands of years of currency history have taught countries and individuals that to be seen as safe and reliable a currency must be backed by something real and valuable. Gold has played that role throughout that time. As the US dollar is no longer backed by gold and the world is awash with the printing of trillions of these dollars, their value is coming increasingly under scrutiny. The Russians and Chinese have been using most of their reserves of dollars to buy gold, as have a number of other countries in the Global South.

When the US went off the gold standard in 1971 due to its continuous Budget and Balance of Payments deficits needed to fund the Vietnam War, the dollar’s value became purely notional. It became a fiat currency and relied for its stability on continuing worldwide confidence in the US capacity to redeem those dollars. But as the world currency is still the dollar the US was not hampered by its increasing inability to pay its foreign debts. It could simply print more dollars to pay for its growing balance of Payments deficits. The other countries accumulating these vast amounts of dollars would then simply recycle them back by buying US Treasuries.

Janet Yellen is now running into the problem that the US owes over $35 trillion dollars. The only way it can continue to function is to keep selling trillions more US treasuries to redeem the vast ocean of dollars that other countries central banks are increasingly unwilling to hold. That has forced the interest rate on those treasuries to new heights in order to attract willing holders. This has sent the interest payments that the US must pay above a trillion dollars in the 2025 fiscal year. That vast servicing cost of the national debt increased the need to sell even more Treasuries just to pay the interest on those already outstanding. It is in essence the biggest Ponzi Scheme in world history.