Nothing gets your attention like a BRIC upside the head. In this case it's Brazil, Russia, India and China. These are the major non-European industrial powers anchored by the world's only superpower China. The rest of the countries of South America, Africa and Asia are more than willing to align with them as their trade continues to shift away from the US and Europe. At their summit in Russia this week they refused to allow the US to even observe the proceedings.
The major focus of the meeting was how they will proceed with the elimination of the US Dollar as the international reserve currency. In the past six months these countries have moved aggressively toward trade among themselves without the use of Dollars. Now that this has been set in motion there is almost no way to stop it. The only thing holding it back is China's reluctance to change, once they are fully committed either by choice or by cascading events, the avalanche will be unstoppable.
This will make the Dollar worthless for international trade and trigger either hyper-inflation or crushing deflation or alternating waves of both here at home. The assumption is that the standard of living of Americans would drop 20% overnight because that is the percentage of our economy that is made up by trade deficit. Its not likely that it would stop there since we not only consume imports but imports are completely integrated into every aspect of our economy. Everything from car parts to surgical supplies are imported and many things that are lynch pins of our economy are exclusively imported.
The turmoil that this could produce has no large scale precedent. With almost no Americans having any sense of ownership in our society the reaction will be a feeling of hopelessness and an every man for himself mentality. The crazies on the right have been priming themselves for this sort of apocalyptic collapse for forty years and will have no doubt who is to blame. Those that don't know who to blame will get a fair and balanced list on Fox News. Watch your back.