Cutting Russia from SWIFT
SWIFT- Society for Worldwide Interbank Financial Telecommunications
They are overseen by the National Bank of Belgium, the U.S. Federal Reserve System, and the European Central Bank. It connects 11,000 financial institutions in more than 200 countries. The SWIFT payments due take 1-4 workings days.
Implications
For the U.S. dollar to be the world's reserve currency, it is dependent on the SWIFT system to be the central point of global trade. The Hub in which dollars dominate/facilitate the exchange between banks.
Russia will be forced to trade directly to its allies like China, in which they will have to use the Yuan, strengthening the Chinese currency.
The US and EU receive most military parts from China and manufacturing. If the Russians cut off the gas to Europe and China cuts off manufacturing supplies to the US. We are essentially in an economic disaster. This is all theoretical and on the table when wars are playing chess.
Other Chess moves would be Russia asking for payment of oil and gas in gold or silver. This pushes the world to realize that the dollar is no longer the strongest currency and is losing its grip of being the world's reserve currency.
Although the U.S. and the EU came out to Sanction certain Russian Banks and Oligarchs. The indications missing from the context provided is no mention of no longer purchasing gas or oil from Russia. Are they pushing to punish Russia indeed, or are they so dependent on Russia that they have to continue economically wise?
How to end Wars
Do keep in mind, The United States imports oil from Canada, their number one exporter, followed by Russia.
The United States and the EU are the ones that have funded this war and still are. They are also the ones funding the defense of Ukraine against the invasion of Russia. Simply put, to end the fight right away is to stop the funding and purchasing of goods for both countries. Money is what keeps the machines going, the bullets flying, and the bombs dropping. The United States and European Countries are still dependent on Russia; they have to make the economic sacrifice in short supply of gas, oil, and electricity. They have to restart the commencement of Nuclear Power plants, fracking, and coal.
The apparent decision is their mistake from the beginning, giving Russia the leverage it has over the most significant countries. Governments are also to blame on this occasion because of their reckless policies and agendas. Governments have only made matters worse and printed more in their mistakes, ever-increasing the debt.
The sanctions are banks that have already been sanctioned by the U.S. as of early 2018. Clarity is missing from the government statements for Russia invading Ukraine. With the sanctions coming forward, it can be declared by Russia as an act of war in “stealing” their funds from Russian central banks. *Possibly* reducing the funding for Russia’s war chest to 1/3. Although Russia holds over 80%+ in gold, they have over the years been unloading on USD exposure. They could even have a backup of Yuan coordination with China. The SWIFT system is still used to purchased gas, oil, and energy. If Russia has to sell its Gold it does have two big buyers like India and China, the 6th and 2nd biggest economies, that have been accumulating gold for their own markets.
Russia has caused a significant selloff in the markets. With Putin leading the charge of Russia’s currency, “Ruble,” it lost 10% of its value against the dollar. They were followed by the Polish “zloty” and Hungarian “forint,” losing about 4% of its value. All other nations in Europe have also felt its currency drop in pricing in which citizens and its people no longer want to hold their countries currency; they seek haven in hard assets. Gold, Silver, Oil, Petrol, Gas, Bitcoin, etc. Something that is understood as un-confiscatable, divisible, transportable, and has value. Gold was the first to react in reaching new highs in just a couple of hours to crash to levels seen since the early 2000s.
The markets on Monday will better indicate what is to come for the days and weeks ahead. The money flow shift will be from equity stocks (capital stock, common stock) into commodities, further dumping the market. Common stocks are looking to have no value in the face of inflation and Russia. But the Stock Market is running out of liquidity due to the Covid Crisis, in which all the money injected into the market has been near liquidated. For further context-click the link below.
Governments and central banks have a crisis in dealing with inflation and Russia. Do they think they can print their way out of this situation?
Things to look at, Monday Market:
The FEDs (Federal Reserve System) stance on QE (money printer) and raising interest rates to combat inflation
The Russian “ruble” collapses further against the dollar, indicating either Russia will start selling its product in Gold or silver. If not, they would sell oil and gas at near pennies against the dollar.
The ECB (European Central Bank) stance on QE and raising interest rates to combat inflation in Europe
The US funding passed for the war. Policies made and enforced
Sanctions placed, where, who
If European countries and the U.S. are still making payments to Russia
Inflation numbers, the price per barrel, supply shortages
Sanctions on Russia