Charles Nenner, a financial analyst that served as head of market timing for Goldman Sachs for more than a decade, has warned about the end of dollar hegemony and its consequences for the U.S. According to Nenner, the BRICS bloc and the influence of Saudi Arabia will end the dollar as a reserve currency, and this could cause a flight to safety.
Charles Nenner Predicts End of USD Hegemony
The U.S. dollar will be undermined as a reserve currency; this is what Charles Nenner, a financial cycles analyst, has predicted for the future. Nenner, who had previously projected the dollar was going to survive, changed his opinion recently, stating that the decline of the U.S. dollar has already begun.
In a recent interview with USA Watchdog, Nenner stated:
I said the dollar is going to hold up, but not anymore, not anymore. It is really in trouble. There is actually no reason to be in the dollar.
The financial analyst estimates that the recent breakout of the BRICS block, composed of Brazil, Russia, India, China, and South Africa, will play a special part in the process, with the help of Saudi Arabia, bringing the dollar hegemony as global reserve currency down.
Nenner believes that, mid-cycle, the economy could experience a bounce due to the weakness of the dollar favoring exports. He explained:
The economy is really going to suffer. If the dollar goes really low, we could have a small bounce in the economy because it’s good for exports. That’s just a fooling bounce for people. Longer term, it’s just finished.
Unintended Consequences
Nenner explains that the fall of the dollar will have a series of consequences for the U.S., starting with other countries running to get rid of U.S. treasuries and running to safety in other assets, including silver and gold.
We are going to have a bad dollar. That usually means people are going to dump their securities. If you have China and Russia dumping their U.S. bonds, you are going to have a problem. I am getting very worried because there might be a run for safety.
China is one of the biggest holders of U.S. treasuries, with $867 billion in U.S. bonds held, comprising a little more than 10% of the total share of the U.S. Debt, just behind Japan.
Other analysts have also predicted the demise of the U.S. dollar recently. Jeffrey Tucker has recently said the U.S. dollar is at a turning point and that it won’t be the king currency anymore. In the same way, Nouriel Roubini has stated the global economy will shift into a bipolar system, using the Chinese yuan as an alternative to the U.S. dollar.
What do you think about Charles Nenner’s predictions? Tell us in the comments section below.
Sergio Goschenko
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