BRICS' GOLDEN SPELL TO DETHRONE DOLLAR

Will the gold-backed national currency end the dominance of the U.S. dollar?  

- Rajiv Ranjan Singh

HUMANITY’S OBSESSION with gold has been a perpetual enigma. On one hand there is Henry Ford, the astute businessman, who claims, “Gold is the most useless thing in the world. I am not interested in money but in the things of which money is merely a symbol.” On the other hand there is Friedrich Nietzsche, the man who delved into the depths of the human psyche. Nietzsche ponders, “But tell me: how did gold get to be the highest value? Because it is uncommon and useless and gleaming and gentle in its brilliance; it always gives itself. Only as an image of the highest virtue did gold get to be the highest value.”

Ironically, the businessman and the philosopher both seem to agree that gold is inherently useless. 

And yet, gold seems to have the mysterious power to change the course of human civilisation. Take the case of a recent tweet by the Russian Embassy in Kenya that simply mentioned that the BRICS nations were planning to introduce a new international currency backed by gold. And lo and behold, the Dollar Index corrected to 100 in the global currency market post the tweet.

Gold vs Fiat

The dollar hegemony has been facing quite a few challenges of late through the concerted efforts led by Russia and China. The cohort of their supporters seems to be getting bigger, with the BRICS bloc tinkering with the idea of launching a new trading currency backed by gold. It is quite obvious that this currency will rival the U.S. dollar in the international arena. The leaders of BRICS nations are meeting on August 22 in South Africa to probably initiate a seismic upheaval in the Fiat currency regime that started about half a century ago.