The ongoing currency war to retain dollar hegemony and Oil-Dollar nexus, a situation that I anticipated in two speeches at Delhi and Patna in 2004; is gripping new players each passing day. Venezuela is on brink of default as 95% of its export is constituted by oil and with below $55 per bbl, it no longer can sustain its welfare programmes and timely payment. After Putins Honey-Bear jibe yesterday,it is becoming clear that Russia will totally delink its oil market with dollar and peg rouble with yuan and also activate its 150 billion yuan swap agreement with China. China with $4 trillion in its forex reserve, will happily oblige as they clearly aim for internationalization of yuan.Chinas entry into currency war and North Koreas entry into cyberwar is making US nervous and to stabilize its own neighbourhood, has re-established diplomatic relationship with Cuba. Its a Third World War--military dimension being pursued by non-state actors from Africa to Ukraine and non-military dimension of finance, pricing, currency, cyber security being pursued by major military powers of the world. As usual, India is the madhyammarg-gamini--neither here nor there.
Posted on: Fri, 19 Dec 2014 16:52:00 +0000
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