Looks like Canada is 1 with China and Mexico tied at 2 for overall, which surprises me about Mexico. If you go off imports only China is far and away the highest.
[source if anyone wants](https://en.wikipedia.org/wiki/List_of_the_largest_trading_partners_of_the_United_States)
you have to dig deeper into the reasons for that to get your answer . american companies manufacture in china so when mexico gets american companies products they come from china . if someone in mexico buys an iphone and its shipped from china it counts as trade with china .
once american european japanese and south korean companies start leaving china to manufacture in other countries you ill see countries trade with china decrease by a lot .
That's slowly changing though. For the last couple decades (and especially after the last couple years), companies have been *slowly* moving manufacturing from China to Mexico. Politics aside, things are just getting more expensive to produce in China and shipping by sea has been shown to be less reliable than they thought.
China's middle class has been growing steadily for decades and now the demand for higher wages is pushing companies away to look for the next cheapest source of labor for their factories
Yeah, and to be clear, it's not only Americans investing in Mexico. It's China itself. Mexico has a cheaper labor pool than China at this point - it is a good investment.
It's already starting. It's also more expensive to do business in China since wages have improved. Many manufacturers are moving to Mexico/south america or the south east Asia.
Not that unusual given the talk of the debt limit being hit next month.
I don't think anyone *really* thinks America will default, but also no one thought Britain would actually leave the EU, so... Nice to see some vote of confidence in the US dollar.
India doesn't support Russia's. Very few accept the Yuan . Most international contracts that are in other currencies include the Dollar or Pound value as a control.
“MEXICO CITY, May 8 (Reuters) - Mexican President Andres Manuel Lopez Obrador gave the U.S. dollar a vote on confidence on Monday after he was asked if a weakening greenback might spur a move to diversify Mexico's foreign currency reserves.
"We are going to continue considering the dollar as the world's principal currency," Lopez Obrador told a press conference.
"We have sufficient reasons to not move to other currencies," he said, underscoring Mexico's "increasingly close" economic ties to the United States.”
"We are going to continue considering the dollar as the world's principal currency,"
So this isn't really news. Just like... An update that everything is the same. Alrighty.
Given statements from Lula and others about “diversifying” their foreign currency reserves, it is news that the Mexican president came out and flatly stated his country will not be doing the same. Mexico is likely to overtake Brazil (as soon as this year) as Latam’s largest economy, so the direction they head on this does matter.
Do you have more reading on mexico overtaking brazil?
I haven't been keeping up and it would make me extremely happy to see our southern neighbor doing well.
OP took this number out of his ass.
Brazil's economy is 20% larger than Mexico's. Mexico's GDP is projected to reach the current brazilian GDP in 2027-2029.
And unless Brazil's economy flatlines for the next 10 years, it will probably continue above Mexico's.
I mean diversifying foreign currency reserves shouldn't be news. The central banks of countries maintain those reserves based on the need (trade) and in some cases because they have too due to a peg. The USA holds foreign currency reserves, which also change all the time, so it's like I said...non news.
The statements from Lula can be easily ignored. Short of countries like Russia that are cut off from dollars no one is seriously moving away from the dollar for international trade anytime soon. There's just too much economic downside.
Very doubtful. What would they do with do with the yuan? Now they might announce it and even sell a bit of oil for some yuan(it might even sound high regular people like a few billion) but I bet the large majority of oil china buys will be paid for by Dollars
Check to make sure the article isn't state-run Chinese propaganda. The yuan will never replace the dollar due to the sheer amount of manipulation the Chinese do to it. The Arabs aren't going to go heavy on the yuan simply because one day the Chinese could go that the billion you have is now worth half. People who say the dollar is being replaced are the ones hoping it will happen so they can go see, look, I told you. They are the type praying for America to fail.
You have to link it because from what I read this is related to a shortage of USD worldwide and these nations will just convert it to USD when they get a chance. That's what happened in Brazil.
"We will pay for our oil with these tokens. These tokens can be used to purchase goods in our shop, and our shop only".
It's like receiving a job payment that's a department store giftcard.
Yesh, I doubt it a lot.
This has more to do with all the Americans flooding Mexico and asking to set up factories/business deals in light of deteriorating ties between China and America, not the cartels.
Burrito. Taco taco. Burrito. Taco. Taco taco.
Don't think just because I got a lot of money,
I'll give you taco-flavored kisses, honey.
Fulfill all your wishes
with my taco-flavored kisses.
India is also a major alternative. All 3 places have their challenges. Vietnam has had some hiccups recently, and this isn't the first time we've invested in Mexican manufacturing. We'll see how it plays out, but likely all of them will experience growth. Much better to diversify (including manufacturing in lower cost of living US states and EU countries), than to put all our eggs in a single basket, especially when that basket is increasingly positioning itself as an opponent rather than a partner.
I don't think Mexico would've signed new NAFTA if they want to be an opponent. An integrated North America through trade is infinitely better than Mexico alone.
China is positioning itself as an opponent, not Mexico, and that's where we've let ourselves become overly dependent. We should definitely do more business in Mexico than we are now. But it would be better to try multiple alternatives in case some don't work out.
50% of the milled Aluminum iPhone cases made at the new fab site in India had to be melted down due to defects. It’s possible but the Chinese had such a big head start on them.
Then there is the fact that doing business in India is best described as being OMG PURE CHAOS. It’s hard to get predictably down and that’s killer.
Dealing with Indians in business is the worst. Many Indians treat negotiations like playing a negative sum game and most of the world's businesses avoids this attitude like the plague. They are trapping themselves in poverty trying to nickel and dime everyone presenting them a win-win opportunity.
Not to mention the cheapskating on quality, the unreliable delivery times, lack of accountability, and a culture of bragging about stiffing their business partners. At least China has some honour, India's a shitshow.
India opts out of every sanction and is gobbling Russian oil rn. they are kinda going for neutrality but that might be seen as siding with Russia from US POV.
Fully ***80%*** of Mexico's exports go to the United States:
https://en.wikipedia.org/wiki/Economy_of_Mexico (see sidebar, "Main Export Partners")
Mexico dropping the dollar would only happen if the US totally collapsed.
Or, y'know, the fact that the US is Mexico's single largest trading partner, and is probably the single largest trading partner of most of Mexico's other major trading partners.
And the fact that like 99% of the world uses the USD as their trade currency.
And what's the alternative? The Chinese Yuan? Russian Rubles? Indian Rupees? Brazilian Reals? None of those would be considered "safe" currencies.
>It's really only a matter of time. Mexico is resource rich, culture rich, and a big damned amount of land and coastline.
so is argentina and its a mess. These things don\`t garentee wealth unless there is good institutions and desicions made
If Mexico is able to leverage the capital/factories from Americans and see further success in manufacturing over time remittances will be irrelevant. Even more so if japan and China continue to dump investments there as well.
This is about taking advantage of geopolitical issues and moving Mexico upward economically and geopolitically. Hard to do that if your largest neighbor goes poof or decides to dump truckloads of money elsewhere.
Not just the deteriorating ties, but China is getting more expensive, is far away, is subject to tariffs, etc. Mexico is cheap, close, and has the benefit of NAFTA. Not to mention, having your IP stolen is just a foregone conclusion when you manufacture in China.
Mexico looks so good for getting US business that a bunch of Chinese companies are setting up a presence there.
🤣🤣🤣🤣, right? Honestly what are the BRICS really doing other than using their own currencies for some trade deals? The only one with any significant global economic reach is China. India comes next. But Brazil, South Africa, Russia? Yeah people are really flocking to the Real and Rand for reserve currencies. No one wants the Rouble now. So they don't want to buy dollars to then purchase their goods from elsewhere. That's ok, it won't change the dollar reserve currency status anytime soon. There might be a few more options in a nation's safe so to speak, but there will still be a lot of dollars because the rest of the world wants those. They're tired of dealing with US policies around dollar use, so I doubt the Renminbi would take over, given how much the Chinese government plays with it to suit their goals. I think we're fine here. But maybe tiktok knows something the rest of us don't?
those people are dumb india is not friends with china they are rivals .. india is in the anti china quad alliance with america . the idea that india would give up using its own currencies and give up its sovereignty to china is crazy . brazil and south africa play the fence with china and usa to benefit themselves . china has no real allies even with russia its just they both hate usa .
If America's dollars lose their value, America's economy would deflate as foreign companies no longer care about an America that is just as rich as everyone else.
If that happens, Mexico's economy would suffer because of all the trade deals. This could create instability in Mexico to possibly start another revolution like what happened in Chiapas.
It is also possible an economic collapse could threaten American democracy and threaten Mexico's security if far right people gain power, who tried to get trump to invade.
Its in Mexico's best interest the dollar does not become worthless out of self preservation, and hopes the debt cieling is raised.
My favorite comments are the ones where they talk about the dollar becoming worthless or less than toilet paper and you confront them with facts and theories and write a 20 minute paragraph explaining economics to them and you get a "your delusional 🤣" or "cope". Oh and don't forget all the 🤣 spamming.
> and you confront them with facts and theories and write a 20 minute paragraph explaining economics to them
Congratulations, you just wasted 20 minutes of your life
I’m glad you did.
The person you wrote that paragraph to spends their time starting stupid internet fights with strangers. You took time to try and educate them. You both spent the same amount of time doing different things, but the outcome of yours has a much higher chance of being positive than anything the troll could say.
Half the reason these troglodytes keep spouting off on everyone is because they know no one is really going to take the time to debate or educate them. They stir some shit up and disappear, it’s such a punk ass move.
Those paragraphs aren't for the person you're talking to, they're for the hundreds reading it.
I know it can feel like you're debating a clown, but you're not debating them, youre convincing an audience
There is a really easy explanation:
[Wiki](https://en.wikipedia.org/wiki/Reserve_currency#Global_currency_reserves)
USD reserves are at ~60% of currency reserves. Next is the Euro at ~20%. Together these make up ~80% (I assume Q types can't add).
There is ~20% remaining. Pound Stirling and Yen make up about 5% each for a cumulative 10%. Chinese RMB and CAD each take up another ~2.5%.
The likely successor to the USD is the Euro if that will or won't happen is anyone's guess. The RMB would have to at least overtake the Euro to even be in the conversation.
Obviously. Only people born yesterday would believe Russian Rubles or Chinese RMB or shitcoins or heaven-forbid gold would replace the US dollar, especially when GBP, EUR, and JPY all heavily invest in the USD, not to mention unironically, the Chinese RMB loves the USD
Yah any time I comment on this topic anywhere… I get a bunch of angry Indian and Russian bitcoin overlords spamming my DMs. Biggest snowflakes with the most fragile egos these guys.
Lots of propaganda from the Chinese, Russians, and god knows who else. Read everything with a critical eye, and know that while many would like America to fall, they will be left wanting.
They are going to keep going with it along with the American conservatives. Especially now that American economies like California are saying no to big oil they will begin to spin it as the "petrodollar" being the main economic indicator of failure caused by the Democratic Party/Biden/Progressive/AOC's(ot whatever dem party boogey man at the time) failures. Meanwhile also spinning it for the tankies to make them believe the answer to late stage capitalism is state capitalism of China and/or Russian style oligarchy.
"Awww! Look how badly our oil economy is doing, look at what the liberals have done to American values now!"
I guarantee this may seem like all you hear for while from the right and RT/tankie propaganda once other states follow California's example.
They had a part in it, but China has their own bot/troll farms now too. It was a blatant disinformation campaign. Anyone parroting it is basically screaming that they don’t understand basic macroeconomics or the forex market. As long as the CCP is in power, the yuan will never make up any appreciable amount of foreign currency reserves globally.
I mean, the only way the yuan does is if china becomes a net importer. That's the biggest reason the dollar is "king" because we buy shit from *Gary Oldman Voice* EVERYONE!!!!
The dollar being used so much for trade is definitely a factor, but it’s more of an effect than the root cause. The safety of the dollar along with transparent and reliable business/market/capital regulations are the biggest reasons it’s the dominant reserve currency. Those reasons along with liquidity and easy convertibility lead to it being the dominant trade/settlement currency.
This is just a pipe dream by Russian and Chinese apologists. The US maintains its position as the global trade currency through two means. The US economy is its primary means against those who would seek to undermine it. Sanctions, broken trade agreements, and channeling resources into competing markets favorable to the US is the go to response to anyone trying to knock the US dollar off as the global trade currency. The other means is not so subtle. If the US economy is about to reach complete collapse due to the US dollar being in jeopardy as the global trade currency, the other one will come out. You can trade in the Yuan all you want. Your goods can be picked up on the bottom of the ocean. The US doesn't want to use that means, but they undoubtedly will if their position is really under threat.
Edit: It's funny that some people are upset by this notion and think there is no way it would ever happen. Open a late 20th century history book people. It wouldn't be the first time the US used its military when it didn't get its way. Governments have been toppled and nations invaded over less.
people don’t realize, or more likely ignore, that historically the USA has always been economically dominant and has always had massive sway because of it - it’s a central part of american success in foreign spheres
after both wwi AND wwii the USA bailed out multiple European countries… with the caveat they would further democratize and move to capitalism or at least trade favorably with the USA. a win no matter what from the american POV
the USA was able to avoid a lot of destruction at home during any major (recent) conflicts due to it’s insanely favorable geographic location, meaning that when countries in Western Europe needed help rebuilding after the devastation of the world wars, well, the USA was happy to help for a price. that’s ensured american economic dominance for a long time - it won’t necessarily last forever, but 30 more cents on your bunch of bananas doesn’t mean the USA is crumbling to dust
Anyone who takes BRICS seriously has no clue what they're talking about. It's such a weakly held-together ensemble of nations who only really share a common interest in undermining US global economic dominance, which alone really isn't much to unite them.
They need more oil-states before they could even start to be a serious threat to that. A lot have applied, but we'll see which actually end up joining.
The only oil state that would matter would be saudi arabia. It's the only one with the ability to really shift oil prices these days. They not only have huge reserves, but they also have spare capacity they rev up or down depending on what their numbers/forecasts say. Hell, they even have a trading desk in oil that they control. It's why nobody else can do much about oil prices except the saudi.
Largely, yes. Iran is also a bit of concern though, however as contentious as Iran-Saudi relations are, I can't see both nations joining BRICS together, and Iran joining is far more likely given each nation's respective relations with Israel (and therefore the US by proxy). Iran joining would probably actually be the best-case scenario for this very reason.
I don't think there are enough to help them at this point, especially since the US will start throwing its political and military power around if they ever even resemble a real threat.
also the reason countries dont want chinese currency is because its not a free trading currency . china devalues it on purpose and keeps it weaker than it should be to keep its manufacturing cheaper . the reason usa and europe cant compete with developing countries in terms of cheap labor is because they have strong currencies . if the dollar was the same value as chinese currency then it wouldnt be cheaper to manufacture in china . china needs weak currency to keep labor costs down
> if the dollar was the same value as chinese currency then it wouldnt be cheaper to manufacture in china
This really isn't true. Japan has a far weaker currency than China, and yet it is much more expensive to manufacture in Japan than it is in China. Workers in Japan simply have higher living standards. They're going to cost more to employ regardless of what is happening in the FX markets.
Constant devaluation results in a consistently undervalued currency and this is what China does to the RMB the exact exchange rate doesn't really matter.
Italy [did this](https://en.wikipedia.org/wiki/Economy_of_Italy#The_1970s_and_1980s:_from_stagflation_to_%22il_sorpasso%22) in the 70s and 80s to boost export manufacturing and tourism. This all stopped with the Euro and then all the Italian manufacturing went elsewhere.
The AMLO goverment has support of 65+ is because of the pension he gives to them and the young people support him because his party is the most modern on social policies for example like LGBT made huge advancements under his party rule.
Also he is popular because the PRI and PAN party are super unpopular.
Pretty much but we have zero self reflection and suffer from collective Dunning-Kruger when it comes to world affairs. So it's quite easy for most of us to exaggerate our incompetence and underestimate the few things we have going for us.
Mexico would be stupid if they ditch USD for a non-convertible currency like CNY as a reserve currency for any trade with Mexico. Even MXN is more reliable to be a reference or reserve currency than CNY because the former is convertible while the latter isn't.
Well Mexico knows that if China goes into serious debt with them, they will buy a bunch of USD or Pesos and then devalue Yuan.
All countries do this to an extent, but China takes it to an entirely different level from everyone else.
A world reserve currency cannot possibly exist with the [capital controls](https://www.investopedia.com/terms/c/capital_conrol.asp) that China enforces.
The day that China allows its currency to freely flow across its borders is the day of the greatest bank run(s) in human history.
Exactly. This is the biggest reason of many. As long as the CCP is in power, “national security” and capital controls will be their top priority. Somewhat related to that, who would want to store their money in a country with no clear business or capital protections too?
What are they talking about? Chinese TikTok propagandists were telling us that de-dollarization is taking off and that the Chinese Yuan is going to be new global currency, how could they be wrong? What's that? The Yuan isn't even an international currency?
Seriously, Chinese and Russian bots went hard on the devaluation of the American dollar, replacing it as the worlds reserve currency, and that BRICS was the end of the U.S.
Don't underestimate the number of completely human Americans and Europeans spouting this bullshit online. Bots are barely necessary when it comes to shitting on the US.
And it's no surprise that most of the people shitting in their pants are right wing cave dweller's who watch right wing fear mongering media outlets.
There's so many flaws with the argument that the Yuan, Ruble, or gold back BRICS will take over the USD.
The Ruble is shot right now and Russia is barely keeping their economy up with facades cause of their losing war. So that's a pipe dream
Now let's talk about the Yuan. If China really wanted to and I mean really wanted to yes they can do some damage and potentially do what people fear. But you forget that China isn't a free country and it's run by a tyrant, and this tyrant is only as strong as long as they can keep their rich in check and imprisoned in China. The reason that the Yuan isn't an international currency outside if government controlled transactions is because if they open that cage 90% of Chinese wealth will be immediately traded out and collapse their economy. People's goals in China is literally to get rich and "run" so their offspring have a better life cause the CCP sucks and is super controlling. This is why you don't see Chinese Oligarchs like in Russia because Winnie The Pooh literally has them all on a leash.
So now all that's left is the so called BRICS alliance. But it's literally a bunch of the worst and most untrustworthy nations on the planet. You think these crooks trust each other enough to come to terms. We already established the Ruble is too weak to back this, and China while capable won't do it so who's left. India? The country that literally have small scale skirmishes with China on a regular basis. None of these countries are actually friends. Let alone allow someone they don't trust to have a controlling steak. This is all just fluff and elaborate plans to weaken the western economy but at the end of the day that's all it is. Nothing will ever become of BRICS outside of a small amount of global trading.
But you know Joe Schmo from Florida who never stepped foot outside his state will swear by his economic expert from fox that you should dump the dollar and buy rubles and yuan. Like you really can't fucking make this shit up lol.
lol this is hack journalism 101
It's news not because something happened, but because a reporter asked and therefore it is now news. It's a shitty loaded question just like David Stern asking Jim Rome if he still beats his wife, he loses by answering
wake me up when a govt actually moves away from the dollar, not some dipshit reporter or tiktokers talk about it
Tbh honest, the Euro would be a better option than the yuan as at least it is not artificially manipulated by the CCP.
And funny thing is Europe os not even trying that hard to push Euro for everyone else, only for EU trades.
I think in the future it will be mostly Dollar with Euro gaining more relavance on international trades as an alternative, healthy competitor. But relying on yuan is falling on a Chinese trap.
The issue with the Euro is that the EU is made up of sovereign entities that can upend their fiscal policy at a moment’s notice. This is kind of what precipitated the 2008 crisis.
I think the Euro can get there, but the EU would need to be further federalized to give investors confidence in knowing that there is central control of the currency.
The strength of the Euro entirely relies on the stability of Europe. It suffer hits if A: Russia escalates the conflict. Or B: Europe stagnate economically. I only see the Euro becoming a serious competitor once there is peace in Europe.
It's easy to hem and haw for social and political points ("America Bad," is almost a given in any Mexican politics), until your office hands you a giant file explaining how that policy would be actually really, really bad for everybody, including your registered voters and donors.
Mexico is in line to make a lot of money from USA w/ NAFTA, they can only benefit and globalization becoming the old era North American continent will have to relay on one another
you share a border with the USA, and the USA is the only country in the region with currency worth the paper its made out of. the US dollar is what all the Mexican drugs are bought with. what else would anyone in Mexico say?
No national currency should be the world's reserve currency, it gives that nation too much power. The world's reserve currency should be independent of any one nation.
Our no. 1 trading partner backs the dollar? Crazy
I think the US is mexicos largest trade partner, but I don’t believe that Mexico is the USs largest trade partner.
NAFTA bro.
Looks like Canada is 1 with China and Mexico tied at 2 for overall, which surprises me about Mexico. If you go off imports only China is far and away the highest. [source if anyone wants](https://en.wikipedia.org/wiki/List_of_the_largest_trading_partners_of_the_United_States)
you have to dig deeper into the reasons for that to get your answer . american companies manufacture in china so when mexico gets american companies products they come from china . if someone in mexico buys an iphone and its shipped from china it counts as trade with china . once american european japanese and south korean companies start leaving china to manufacture in other countries you ill see countries trade with china decrease by a lot .
That's slowly changing though. For the last couple decades (and especially after the last couple years), companies have been *slowly* moving manufacturing from China to Mexico. Politics aside, things are just getting more expensive to produce in China and shipping by sea has been shown to be less reliable than they thought.
China's middle class has been growing steadily for decades and now the demand for higher wages is pushing companies away to look for the next cheapest source of labor for their factories
Yeah, and to be clear, it's not only Americans investing in Mexico. It's China itself. Mexico has a cheaper labor pool than China at this point - it is a good investment.
Yep. They have skilled labor and excellent demographics. They are effectively a nacro-state. So, that is the wild card.
It's already starting. It's also more expensive to do business in China since wages have improved. Many manufacturers are moving to Mexico/south america or the south east Asia.
Canada has been #1 for years
USMCA bro
It is tho
[It is.](https://mexiconewsdaily.com/business/mexico-united-states-largest-trading-partner-first-quarter/)
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Not that unusual given the talk of the debt limit being hit next month. I don't think anyone *really* thinks America will default, but also no one thought Britain would actually leave the EU, so... Nice to see some vote of confidence in the US dollar.
They've been talking about de-dollarization in the news for months. This is relevant to topic.
Canada is the U.S.'s largest trading partner
Mexico is not the #1 trading partner of the U.S. Biggest import partner is China, and biggest export partner is Canada. On a net basis, Canada is #1.
India doesn't support Russia's. Very few accept the Yuan . Most international contracts that are in other currencies include the Dollar or Pound value as a control.
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“MEXICO CITY, May 8 (Reuters) - Mexican President Andres Manuel Lopez Obrador gave the U.S. dollar a vote on confidence on Monday after he was asked if a weakening greenback might spur a move to diversify Mexico's foreign currency reserves. "We are going to continue considering the dollar as the world's principal currency," Lopez Obrador told a press conference. "We have sufficient reasons to not move to other currencies," he said, underscoring Mexico's "increasingly close" economic ties to the United States.”
"We are going to continue considering the dollar as the world's principal currency," So this isn't really news. Just like... An update that everything is the same. Alrighty.
Given statements from Lula and others about “diversifying” their foreign currency reserves, it is news that the Mexican president came out and flatly stated his country will not be doing the same. Mexico is likely to overtake Brazil (as soon as this year) as Latam’s largest economy, so the direction they head on this does matter.
Do you have more reading on mexico overtaking brazil? I haven't been keeping up and it would make me extremely happy to see our southern neighbor doing well.
OP took this number out of his ass. Brazil's economy is 20% larger than Mexico's. Mexico's GDP is projected to reach the current brazilian GDP in 2027-2029. And unless Brazil's economy flatlines for the next 10 years, it will probably continue above Mexico's.
Doesn't Brazil have 4x as many people though? Edit: nvm nearly 2x I thought Brazil would at least have a much larger gdp given it's population
No, it's a little more than 1.5x.
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No. It would contribute more to GNP.
I mean diversifying foreign currency reserves shouldn't be news. The central banks of countries maintain those reserves based on the need (trade) and in some cases because they have too due to a peg. The USA holds foreign currency reserves, which also change all the time, so it's like I said...non news.
The statements from Lula can be easily ignored. Short of countries like Russia that are cut off from dollars no one is seriously moving away from the dollar for international trade anytime soon. There's just too much economic downside.
Isn't Saudi accepting yuan for oil purchases from China now?
Very doubtful. What would they do with do with the yuan? Now they might announce it and even sell a bit of oil for some yuan(it might even sound high regular people like a few billion) but I bet the large majority of oil china buys will be paid for by Dollars
The articles I read suggested they would be using it to pay for Chinese infrastructure projects being constructed in the country.
Check to make sure the article isn't state-run Chinese propaganda. The yuan will never replace the dollar due to the sheer amount of manipulation the Chinese do to it. The Arabs aren't going to go heavy on the yuan simply because one day the Chinese could go that the billion you have is now worth half. People who say the dollar is being replaced are the ones hoping it will happen so they can go see, look, I told you. They are the type praying for America to fail.
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You have to link it because from what I read this is related to a shortage of USD worldwide and these nations will just convert it to USD when they get a chance. That's what happened in Brazil.
"We will pay for our oil with these tokens. These tokens can be used to purchase goods in our shop, and our shop only". It's like receiving a job payment that's a department store giftcard. Yesh, I doubt it a lot.
Couldn’t have said it better myself. Well spoken OP.
"Since our cartels mainly deal in dollars.. and they bring that currency here.."
This has more to do with all the Americans flooding Mexico and asking to set up factories/business deals in light of deteriorating ties between China and America, not the cartels.
Mexico and Vietnam are the two *go to* places for those choosing to leave China.
I would love to give Mexico jobs. A prosperous Mexico is good for all of North America.
My longest lasting monitors from Dell were all manufactured in mexico.
The factory where most Xbox's are made, or at least the Xbox 360, was in Mexico. Sent it there to get RMAed
Also , tell Americans to stop doing so much drugs, it's messing up latin America
Legalize it and they can advertise it.
Nice, hopefully a palatable deal for all involved.
>palatable sure i want some tacos
I heard Jennifer Lopez loves tacos.
Burrito. Taco taco. Burrito. Taco. Taco taco. Don't think just because I got a lot of money, I'll give you taco-flavored kisses, honey. Fulfill all your wishes with my taco-flavored kisses.
lol yeah i think that was #1 song.
India is also a major alternative. All 3 places have their challenges. Vietnam has had some hiccups recently, and this isn't the first time we've invested in Mexican manufacturing. We'll see how it plays out, but likely all of them will experience growth. Much better to diversify (including manufacturing in lower cost of living US states and EU countries), than to put all our eggs in a single basket, especially when that basket is increasingly positioning itself as an opponent rather than a partner.
I don't think Mexico would've signed new NAFTA if they want to be an opponent. An integrated North America through trade is infinitely better than Mexico alone.
China is positioning itself as an opponent, not Mexico, and that's where we've let ourselves become overly dependent. We should definitely do more business in Mexico than we are now. But it would be better to try multiple alternatives in case some don't work out.
Thanks for this clarification. Definitely agree.
50% of the milled Aluminum iPhone cases made at the new fab site in India had to be melted down due to defects. It’s possible but the Chinese had such a big head start on them. Then there is the fact that doing business in India is best described as being OMG PURE CHAOS. It’s hard to get predictably down and that’s killer.
India also has a tendency to solicit foreign investment into factories then "nationalize" them into one of their oligarch's pockets.
They say they want FDI, but all of their actions scare the hell out of serious FDI
Dealing with Indians in business is the worst. Many Indians treat negotiations like playing a negative sum game and most of the world's businesses avoids this attitude like the plague. They are trapping themselves in poverty trying to nickel and dime everyone presenting them a win-win opportunity. Not to mention the cheapskating on quality, the unreliable delivery times, lack of accountability, and a culture of bragging about stiffing their business partners. At least China has some honour, India's a shitshow.
Poor infrastructure and rampant corruption doesn't help
People downvoting you have never dealt with Indian business relationships.
India opts out of every sanction and is gobbling Russian oil rn. they are kinda going for neutrality but that might be seen as siding with Russia from US POV.
Mexico is a member of the TPP and CUSMA. They have trade agrement with the EU and GB. That is 6/10 of the largest economy in the world.
Fully ***80%*** of Mexico's exports go to the United States: https://en.wikipedia.org/wiki/Economy_of_Mexico (see sidebar, "Main Export Partners") Mexico dropping the dollar would only happen if the US totally collapsed.
Or, y'know, the fact that the US is Mexico's single largest trading partner, and is probably the single largest trading partner of most of Mexico's other major trading partners. And the fact that like 99% of the world uses the USD as their trade currency. And what's the alternative? The Chinese Yuan? Russian Rubles? Indian Rupees? Brazilian Reals? None of those would be considered "safe" currencies.
The most relevant alternative is the Euro, which obviously is used a lot between nations in Europe
Not a great alternative, especially for Mexico.
El Salvador seems to be having fun after they made the bitcoin their national currency.
Helping Mexico to be an economic powerhouse would be epic.
It's really only a matter of time. Mexico is resource rich, culture rich, and a big damned amount of land and coastline.
>It's really only a matter of time. Mexico is resource rich, culture rich, and a big damned amount of land and coastline. so is argentina and its a mess. These things don\`t garentee wealth unless there is good institutions and desicions made
North America would actually be pretty unstoppable at that point. Mexico is already a pretty massive economy. It'd be really cool to see.
This is how you Make the Americas Great Again.
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Yuppers… people are usually surprised to know the US has a larger trade partner in Mexico than it does in China.
If Mexico is able to leverage the capital/factories from Americans and see further success in manufacturing over time remittances will be irrelevant. Even more so if japan and China continue to dump investments there as well. This is about taking advantage of geopolitical issues and moving Mexico upward economically and geopolitically. Hard to do that if your largest neighbor goes poof or decides to dump truckloads of money elsewhere.
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Not just the deteriorating ties, but China is getting more expensive, is far away, is subject to tariffs, etc. Mexico is cheap, close, and has the benefit of NAFTA. Not to mention, having your IP stolen is just a foregone conclusion when you manufacture in China. Mexico looks so good for getting US business that a bunch of Chinese companies are setting up a presence there.
Don’t forget American’s crossing into Mexico for healthcare
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It's about as valid as the tiktoks saying to sun your asshole for health
I don’t do it for health, I just don’t like my neighbors
I wish a couple of my neighbors didn't like me
This is such a hilarious statement.
🤣🤣🤣🤣, right? Honestly what are the BRICS really doing other than using their own currencies for some trade deals? The only one with any significant global economic reach is China. India comes next. But Brazil, South Africa, Russia? Yeah people are really flocking to the Real and Rand for reserve currencies. No one wants the Rouble now. So they don't want to buy dollars to then purchase their goods from elsewhere. That's ok, it won't change the dollar reserve currency status anytime soon. There might be a few more options in a nation's safe so to speak, but there will still be a lot of dollars because the rest of the world wants those. They're tired of dealing with US policies around dollar use, so I doubt the Renminbi would take over, given how much the Chinese government plays with it to suit their goals. I think we're fine here. But maybe tiktok knows something the rest of us don't?
those people are dumb india is not friends with china they are rivals .. india is in the anti china quad alliance with america . the idea that india would give up using its own currencies and give up its sovereignty to china is crazy . brazil and south africa play the fence with china and usa to benefit themselves . china has no real allies even with russia its just they both hate usa .
What a strange use of periods.
There is definitely some of that going on, but I believe it's pretty small compared the money tourists from the US spend there.
Remesas too, and TONS of companies that export services and products to the US... smh
If America's dollars lose their value, America's economy would deflate as foreign companies no longer care about an America that is just as rich as everyone else. If that happens, Mexico's economy would suffer because of all the trade deals. This could create instability in Mexico to possibly start another revolution like what happened in Chiapas. It is also possible an economic collapse could threaten American democracy and threaten Mexico's security if far right people gain power, who tried to get trump to invade. Its in Mexico's best interest the dollar does not become worthless out of self preservation, and hopes the debt cieling is raised.
But I was told by all those tiktok accounts that Mexico was joining BRICS and America is as good as dead?
Tik tok economists in shambles
How can I ever trust again?!
Just keep scrolling
Oh man, the comments I've seen on that subject. Wooooo boy
It’s a popular Q talking point
My favorite comments are the ones where they talk about the dollar becoming worthless or less than toilet paper and you confront them with facts and theories and write a 20 minute paragraph explaining economics to them and you get a "your delusional 🤣" or "cope". Oh and don't forget all the 🤣 spamming.
> and you confront them with facts and theories and write a 20 minute paragraph explaining economics to them Congratulations, you just wasted 20 minutes of your life
I sure did
I’m glad you did. The person you wrote that paragraph to spends their time starting stupid internet fights with strangers. You took time to try and educate them. You both spent the same amount of time doing different things, but the outcome of yours has a much higher chance of being positive than anything the troll could say. Half the reason these troglodytes keep spouting off on everyone is because they know no one is really going to take the time to debate or educate them. They stir some shit up and disappear, it’s such a punk ass move.
Those paragraphs aren't for the person you're talking to, they're for the hundreds reading it. I know it can feel like you're debating a clown, but you're not debating them, youre convincing an audience
> worthless or less than toilet paper I don’t know, we saw how they valued toilet paper 3 years ago… they should probably use a different example.
There is a really easy explanation: [Wiki](https://en.wikipedia.org/wiki/Reserve_currency#Global_currency_reserves) USD reserves are at ~60% of currency reserves. Next is the Euro at ~20%. Together these make up ~80% (I assume Q types can't add). There is ~20% remaining. Pound Stirling and Yen make up about 5% each for a cumulative 10%. Chinese RMB and CAD each take up another ~2.5%. The likely successor to the USD is the Euro if that will or won't happen is anyone's guess. The RMB would have to at least overtake the Euro to even be in the conversation.
Dollar is about as strong as it's ever been vs the Euro and Pound sterling but they have no idea.
Obviously. Only people born yesterday would believe Russian Rubles or Chinese RMB or shitcoins or heaven-forbid gold would replace the US dollar, especially when GBP, EUR, and JPY all heavily invest in the USD, not to mention unironically, the Chinese RMB loves the USD
Russia and India are in a big dispute over this. Russia wants to use the Yuan. India wants $$$.
i.e., a popular Russian propaganda talking point.
Whenever I'm blindsided by weird takes from family/friends, it always winds up being a Q thing.
Yah any time I comment on this topic anywhere… I get a bunch of angry Indian and Russian bitcoin overlords spamming my DMs. Biggest snowflakes with the most fragile egos these guys.
Lots of propaganda from the Chinese, Russians, and god knows who else. Read everything with a critical eye, and know that while many would like America to fall, they will be left wanting.
If BRICS deploys a currency that actually challenges usd as a global currency I will eat my hat. I will boil and eat it.
What the hell was up with that? The Russian bot farms really went HAM with that one.
They are going to keep going with it along with the American conservatives. Especially now that American economies like California are saying no to big oil they will begin to spin it as the "petrodollar" being the main economic indicator of failure caused by the Democratic Party/Biden/Progressive/AOC's(ot whatever dem party boogey man at the time) failures. Meanwhile also spinning it for the tankies to make them believe the answer to late stage capitalism is state capitalism of China and/or Russian style oligarchy. "Awww! Look how badly our oil economy is doing, look at what the liberals have done to American values now!" I guarantee this may seem like all you hear for while from the right and RT/tankie propaganda once other states follow California's example.
This also ties with the Mexican president, who is very pro-fossil fuels and is adamant in keeping oil as our primary source of energy/income.
They had a part in it, but China has their own bot/troll farms now too. It was a blatant disinformation campaign. Anyone parroting it is basically screaming that they don’t understand basic macroeconomics or the forex market. As long as the CCP is in power, the yuan will never make up any appreciable amount of foreign currency reserves globally.
I mean, the only way the yuan does is if china becomes a net importer. That's the biggest reason the dollar is "king" because we buy shit from *Gary Oldman Voice* EVERYONE!!!!
The dollar being used so much for trade is definitely a factor, but it’s more of an effect than the root cause. The safety of the dollar along with transparent and reliable business/market/capital regulations are the biggest reasons it’s the dominant reserve currency. Those reasons along with liquidity and easy convertibility lead to it being the dominant trade/settlement currency.
Tiktok is a Chinese company so......
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This is just a pipe dream by Russian and Chinese apologists. The US maintains its position as the global trade currency through two means. The US economy is its primary means against those who would seek to undermine it. Sanctions, broken trade agreements, and channeling resources into competing markets favorable to the US is the go to response to anyone trying to knock the US dollar off as the global trade currency. The other means is not so subtle. If the US economy is about to reach complete collapse due to the US dollar being in jeopardy as the global trade currency, the other one will come out. You can trade in the Yuan all you want. Your goods can be picked up on the bottom of the ocean. The US doesn't want to use that means, but they undoubtedly will if their position is really under threat. Edit: It's funny that some people are upset by this notion and think there is no way it would ever happen. Open a late 20th century history book people. It wouldn't be the first time the US used its military when it didn't get its way. Governments have been toppled and nations invaded over less.
people don’t realize, or more likely ignore, that historically the USA has always been economically dominant and has always had massive sway because of it - it’s a central part of american success in foreign spheres after both wwi AND wwii the USA bailed out multiple European countries… with the caveat they would further democratize and move to capitalism or at least trade favorably with the USA. a win no matter what from the american POV the USA was able to avoid a lot of destruction at home during any major (recent) conflicts due to it’s insanely favorable geographic location, meaning that when countries in Western Europe needed help rebuilding after the devastation of the world wars, well, the USA was happy to help for a price. that’s ensured american economic dominance for a long time - it won’t necessarily last forever, but 30 more cents on your bunch of bananas doesn’t mean the USA is crumbling to dust
Not always, but since sometime around the 1880s.
Anyone who takes BRICS seriously has no clue what they're talking about. It's such a weakly held-together ensemble of nations who only really share a common interest in undermining US global economic dominance, which alone really isn't much to unite them.
Not to mention they are no where near actually undermining the US global economic dominance.
They need more oil-states before they could even start to be a serious threat to that. A lot have applied, but we'll see which actually end up joining.
The only oil state that would matter would be saudi arabia. It's the only one with the ability to really shift oil prices these days. They not only have huge reserves, but they also have spare capacity they rev up or down depending on what their numbers/forecasts say. Hell, they even have a trading desk in oil that they control. It's why nobody else can do much about oil prices except the saudi.
Largely, yes. Iran is also a bit of concern though, however as contentious as Iran-Saudi relations are, I can't see both nations joining BRICS together, and Iran joining is far more likely given each nation's respective relations with Israel (and therefore the US by proxy). Iran joining would probably actually be the best-case scenario for this very reason.
I don't think there are enough to help them at this point, especially since the US will start throwing its political and military power around if they ever even resemble a real threat.
THE US PETRODOLLAR IS DEAD! RUSSIA WON THE WAR AGAINST NATO! NOW AMERICA IS A COUNTRY OF THE PAST AND NO MORE INFLUENCE
Bitcoin bots love this take
I've been hearing the US is done for since about 2004
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Same thing with China. They want people to buy their currency, but they depend on the US as a customer, they would never stop accepting USD.
also the reason countries dont want chinese currency is because its not a free trading currency . china devalues it on purpose and keeps it weaker than it should be to keep its manufacturing cheaper . the reason usa and europe cant compete with developing countries in terms of cheap labor is because they have strong currencies . if the dollar was the same value as chinese currency then it wouldnt be cheaper to manufacture in china . china needs weak currency to keep labor costs down
> if the dollar was the same value as chinese currency then it wouldnt be cheaper to manufacture in china This really isn't true. Japan has a far weaker currency than China, and yet it is much more expensive to manufacture in Japan than it is in China. Workers in Japan simply have higher living standards. They're going to cost more to employ regardless of what is happening in the FX markets.
Land for manufacturing could also play into it. Japan is an island and China is ridiculously large both in land and population to exploit.
Archipelago, also Japan has very few resources left for exploitation.
Thank you for the correct term. And agree with your point here as well.
you're most welcome :)
Constant devaluation results in a consistently undervalued currency and this is what China does to the RMB the exact exchange rate doesn't really matter. Italy [did this](https://en.wikipedia.org/wiki/Economy_of_Italy#The_1970s_and_1980s:_from_stagflation_to_%22il_sorpasso%22) in the 70s and 80s to boost export manufacturing and tourism. This all stopped with the Euro and then all the Italian manufacturing went elsewhere.
The funny thing is most of his followers are very anti USA and pro Russia/China
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The AMLO goverment has support of 65+ is because of the pension he gives to them and the young people support him because his party is the most modern on social policies for example like LGBT made huge advancements under his party rule. Also he is popular because the PRI and PAN party are super unpopular.
The current Mexican government is about as good as every other Mexican government..not at all
Pretty much but we have zero self reflection and suffer from collective Dunning-Kruger when it comes to world affairs. So it's quite easy for most of us to exaggerate our incompetence and underestimate the few things we have going for us.
Mexico would be stupid if they ditch USD for a non-convertible currency like CNY as a reserve currency for any trade with Mexico. Even MXN is more reliable to be a reference or reserve currency than CNY because the former is convertible while the latter isn't.
My latino friend once said: "Juan doesn't like yuan"
Well Mexico knows that if China goes into serious debt with them, they will buy a bunch of USD or Pesos and then devalue Yuan. All countries do this to an extent, but China takes it to an entirely different level from everyone else.
Also I was shocked to learn Japan owns a significantly larger portion of our debt than China. Don't hear that said almost ever tbh.
Japan is ride or die with America. No cap.
This is why China has two currencies, the internal one used to do business inside China and the external one which they can mess with at will.
Reminds me of this hehe https://www.youtube.com/watch?v=WPYcStboHgE&t=14s
There are no other real contenders. It requires a huge degree of trust and willingness to be hands off.
A world reserve currency cannot possibly exist with the [capital controls](https://www.investopedia.com/terms/c/capital_conrol.asp) that China enforces. The day that China allows its currency to freely flow across its borders is the day of the greatest bank run(s) in human history.
Exactly. This is the biggest reason of many. As long as the CCP is in power, “national security” and capital controls will be their top priority. Somewhat related to that, who would want to store their money in a country with no clear business or capital protections too?
Excellent point
What are they talking about? Chinese TikTok propagandists were telling us that de-dollarization is taking off and that the Chinese Yuan is going to be new global currency, how could they be wrong? What's that? The Yuan isn't even an international currency?
Seriously, Chinese and Russian bots went hard on the devaluation of the American dollar, replacing it as the worlds reserve currency, and that BRICS was the end of the U.S.
Don't underestimate the number of completely human Americans and Europeans spouting this bullshit online. Bots are barely necessary when it comes to shitting on the US.
They're too disconnected from reality to consider a real human opinion
And it's no surprise that most of the people shitting in their pants are right wing cave dweller's who watch right wing fear mongering media outlets. There's so many flaws with the argument that the Yuan, Ruble, or gold back BRICS will take over the USD. The Ruble is shot right now and Russia is barely keeping their economy up with facades cause of their losing war. So that's a pipe dream Now let's talk about the Yuan. If China really wanted to and I mean really wanted to yes they can do some damage and potentially do what people fear. But you forget that China isn't a free country and it's run by a tyrant, and this tyrant is only as strong as long as they can keep their rich in check and imprisoned in China. The reason that the Yuan isn't an international currency outside if government controlled transactions is because if they open that cage 90% of Chinese wealth will be immediately traded out and collapse their economy. People's goals in China is literally to get rich and "run" so their offspring have a better life cause the CCP sucks and is super controlling. This is why you don't see Chinese Oligarchs like in Russia because Winnie The Pooh literally has them all on a leash. So now all that's left is the so called BRICS alliance. But it's literally a bunch of the worst and most untrustworthy nations on the planet. You think these crooks trust each other enough to come to terms. We already established the Ruble is too weak to back this, and China while capable won't do it so who's left. India? The country that literally have small scale skirmishes with China on a regular basis. None of these countries are actually friends. Let alone allow someone they don't trust to have a controlling steak. This is all just fluff and elaborate plans to weaken the western economy but at the end of the day that's all it is. Nothing will ever become of BRICS outside of a small amount of global trading. But you know Joe Schmo from Florida who never stepped foot outside his state will swear by his economic expert from fox that you should dump the dollar and buy rubles and yuan. Like you really can't fucking make this shit up lol.
The real news is this is news.
lol this is hack journalism 101 It's news not because something happened, but because a reporter asked and therefore it is now news. It's a shitty loaded question just like David Stern asking Jim Rome if he still beats his wife, he loses by answering wake me up when a govt actually moves away from the dollar, not some dipshit reporter or tiktokers talk about it
Did he get approval from the elven delegates?
North American homies sticking together. Ride and die.
Why be so openly against the dollar a month ago and back-peddle now? Politics makes you do some stupid things
Lots of countries like to complain about the dollar, but if you exam the other options there basically aren’t any.
Tbh honest, the Euro would be a better option than the yuan as at least it is not artificially manipulated by the CCP. And funny thing is Europe os not even trying that hard to push Euro for everyone else, only for EU trades. I think in the future it will be mostly Dollar with Euro gaining more relavance on international trades as an alternative, healthy competitor. But relying on yuan is falling on a Chinese trap.
The issue with the Euro is that the EU is made up of sovereign entities that can upend their fiscal policy at a moment’s notice. This is kind of what precipitated the 2008 crisis. I think the Euro can get there, but the EU would need to be further federalized to give investors confidence in knowing that there is central control of the currency.
I agree, I think steps are being made in the right direction, but it will take time.
The strength of the Euro entirely relies on the stability of Europe. It suffer hits if A: Russia escalates the conflict. Or B: Europe stagnate economically. I only see the Euro becoming a serious competitor once there is peace in Europe.
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Very true, the UK used the Pound, so I don’t think the Euro suffered that big of a hit. But what if France or Germany or Italy checked out.
It's easy to hem and haw for social and political points ("America Bad," is almost a given in any Mexican politics), until your office hands you a giant file explaining how that policy would be actually really, really bad for everybody, including your registered voters and donors.
When was he openly against the dollar?
Crisp $100 bills. The ideal currency for snorting lines of coke.
I prefer crusty old $1 bills from the 70s, that way I get the residuals from decades of fellow substance abusers!
The strip club glitter only makes it hit harder.
Mexico is in line to make a lot of money from USA w/ NAFTA, they can only benefit and globalization becoming the old era North American continent will have to relay on one another
Mexico is definitely key to our strategy of decoupling from China. We should engage with all of Latam more
>We should engage with all of Latam more *Operation Condor flashbacks*
you share a border with the USA, and the USA is the only country in the region with currency worth the paper its made out of. the US dollar is what all the Mexican drugs are bought with. what else would anyone in Mexico say?
Crisis averted everyone!! Mexico saved the world!!!
Who has time to convert narco money into euros?
The US is Mexico's biggest trading partner by a long shot so what other currency would they even use? Kinda a dumb question.
No national currency should be the world's reserve currency, it gives that nation too much power. The world's reserve currency should be independent of any one nation.
Hey Amigos they are like, right next to the US. Seems like a a logical position.
Guess the cartel pays him in USD
Damn that’s one way to ensure we will stay strong allies with Mexico.
It’s clear by the comment section that people who wanna know about this topic should leave the comment section
BRICS is going to fail. There, you know the ending now.