BRICS and Gold: The Endgame for the U.S. Dollar Has Begun

Written by Bill Brocius

Janet Yellen's speech at the U.S. Treasury Market Conference on Sept. 26, 2024, was ostensibly about risks in the banking system and U.S. Treasury debt. But beneath the surface, the real message was more alarming. Yellen wasn’t just addressing financial risks—she was subtly setting the stage for the next major threat to the U.S. dollar.

In an interview with Politico ahead of her speech, Yellen was asked about the potential chaos that could arise during the upcoming presidential transition. The question itself was loaded with bias—implying that Donald Trump, whether he wins or loses, is the problem. Should Trump lose, the narrative goes, he may claim the election was “rigged.” If he wins, radical groups like Antifa could escalate their violent protests. My take? It’s far more likely the latter happens, but the media, ever eager to vilify Trump, will push the opposite story.

Yellen’s response was telling. She emphasized the importance of the “rule of law” and how it strengthens America’s democratic system and financial stability. At first glance, this sounds like a simple endorsement of law and order, right? Wrong. This was Yellen’s not-so-subtle way of linking Trump’s actions from January 6, 2021, to potential risks to the entire U.S. financial system. Translation: Trump equals instability, and any disruption in 2025—whether real or fabricated—would threaten the dollar itself.

But here's the kicker. The real threat to the U.S. Treasury market, and by extension the dollar, isn’t Trump. It’s Janet Yellen. The Treasury Secretary is playing with fire by attempting to seize $300 billion in U.S. Treasury securities owned by Russia’s central bank. These assets are held in U.S. and European banks and Euroclear in Brussels. Yellen’s illegal push to convert these assets into financial aid for Ukraine isn’t just a violation of trust—it's a signal to the world that U.S. Treasury securities are no longer safe.

This reckless move is accelerating the creation of a new global currency—one backed by gold, and driven by the BRICS nations. We’re seeing the beginnings of a financial revolution, and Yellen’s actions are pushing the rest of the world to build a system that no longer depends on the dollar.

The BRICS Currency Revolution

BRICS—the economic alliance consisting of Brazil, Russia, India, China, and South Africa—has been slowly but steadily building its alternative to the dollar since 2009. Last year, they expanded by adding Egypt, Ethiopia, Iran, and the UAE. And at the upcoming BRICS summit in Kazan, Russia on October 22–24, new members will be announced, bringing them closer to launching a BRICS currency that could undermine the U.S. dollar’s dominance in global trade.

Will this BRICS currency instantly dethrone the dollar? Not overnight. But the groundwork is being laid. The BRICS nations are establishing their own payment channels, digital ledgers, and a shared issuer, likely the New Development Bank (NDB) in Shanghai. The key advantage they are building is a large, diverse membership. This critical mass would make it possible for BRICS nations to trade with each other using their own currency—freeing themselves from the stranglehold of the dollar.

Picture this: Russia sells oil to China, earns BRICS currency, and then uses that same currency to buy goods from Brazil or Malaysia. It’s a system designed to cut out the dollar, and with the growing discontent among non-Western countries over U.S. financial dominance, this could gain traction fast.

But creating a new reserve currency will take time. A reserve currency needs a massive, liquid bond market—something BRICS doesn’t have yet. This is where the U.S. still has a major advantage. The Treasury market is the deepest, most liquid in the world, supported by complex infrastructure and the rule of law. Yet, Yellen’s reckless behavior is eroding that trust.

By freezing Russian assets and threatening to outright steal them, Yellen is undermining the very thing that makes U.S. Treasury securities attractive—reliability. Nations around the world are watching and wondering: could their reserves be next?

The Rise of Gold

Here’s what’s really happening. Central banks, particularly in the Global South, are ditching U.S. Treasuries in favor of gold. Since 2010, central banks have been net buyers of gold, and this trend is only accelerating. Why? Because gold is a physical asset, free from the political machinations of Yellen or the White House. It can’t be frozen, seized, or stolen—provided it's in the right hands.

As BRICS advances toward a currency union, gold will remain the asset of choice for nations wary of U.S. overreach. Until BRICS establishes a fully operational reserve currency, gold will continue to rise as the safe-haven asset.

The Dollar’s Slow Demise

Yellen’s desperate attempts to prop up the Biden administration by attacking Trump, and now by raiding Russian assets, have become a global liability. What started as a politically motivated maneuver to discredit Trump has spiraled into something much bigger—a direct threat to the U.S. dollar and the entire financial system.

The BRICS nations are watching. The Global South is watching. And what they see is an opportunity to build something new—something that doesn’t rely on the whims of the U.S. Treasury Secretary.

The dollar won’t collapse tomorrow but make no mistake: the seeds of its destruction have been planted. And Janet Yellen is the one holding the shovel.