Here’s an interesting short video exposition by Jackson Hinkle on the decline of the Dollar as the World’s most sought-after reserve currency, worth a few minutes of your time (if you can get past the laudatory comments about Ron Paul). For what it’s worth, I dislike the offensive use of Putin’s grinning image on that video, but I understand it’s meant to be ironic.
Many factors contribute to the Dollar’s decline, including the share of U.S. production in the world market, which peaked in the years following World War II, and has naturally continued to decline since then as other countries have become more prosperous. The most interesting recent “de-Dollarizing” factor is the regime of sanctions against Russia, which has had the affect of encouraging some nations, such as India, to trade with Russia using other currencies. As Hinkle points out …
“Indian companies are increasingly using Asian currencies to buy coal from Russia, ditching trade in the U.S. Dollar to get around western sanctions … these sanctions are supposed to hurt Russia and help the West but in fact these are hurting the West, they are hurting the Dollar reserve, they are hurting the strength of the Euro and the Dollar because there is less and less trade being done in their name.”
In general, the formerly “unipolar world,” dominated by the U.S, with its pre-eminent economic and military might, is becoming an increasingly “multipolar world,” with U.S, power (in the many senses of that word) slowly but conspicuously shifting to other national players. [Don]
See also this article: “The demise of the dollar? Reserve currencies in the era of ‘going big’“